Zix to acquire AppRiver, cloud-based cybersecurity solutions provider>
Help Net Security
Zix has entered into a definitive agreement to acquire AppRiver for $275 million in cash. âThis acquisition builds on those efforts in a monumental way: weâre combining two email security companies that can drive great synergies and higher growth together by leveraging Zixâs superior product delivery and AppRiverâs exceptional customer service and support. More specifically, the acquisition helps us expand our customer base, enhance our advanced threat protection position, and accelerate our high-velocity go-to-market strategy through AppRiverâs numerous and longstanding channel partnerships. Most importantly it further accelerates our offerings into the cloud at the point of initial cloud application purchase. Email is typically the first application that gets moved to the cloud, and this acquisition puts us squarely at the beginning of our customersâ cloud migration. We look forward to capturing more mailboxes and additional services for years to come. The Annual Recurring Revenue (ARR) of the combined company (representing the projected future revenue to be generated over the ensuing 12-month period) is expected to be approximately $180 million at closing. Zix is targeting ARR of approximately $200 million to $207 million at fiscal 2019 year end, representing a growth rate of approximately 11% to 15% year-over-year. Acquisition summary and key developments ⢠Total acquisition consideration at close is expected to be $275 million in cash, subject to customary working capital adjustments and certain expense sharing arrangements, ⢠AppRiver expected to more than double Zixâs revenue and adjusted EBITDA, while scaling ARR to more than $180 million, which for the combined business is expected to grow organically at 11% to 15% year-over-year in fiscal 2019, ⢠Approximately $8 million of cost savings are expected to be realized within the first 12 to 18 months following the acquisition close, ⢠True Wind Capital to invest $100 million in a convertible preferred equity investment that will be funded with closing of the AppRiver acquisition; James H. Greene, Jr. (Founding Partner) and Brandon Van Buren (Principal) will join Zixâs board of directors at the closing, ⢠Zix has received a commitment letter from SunTrust Bank and KeyBanc Capital Markets with regard to a new five-year $175 million term loan and a $25 million revolving credit facility,
Link: https://www.helpnetsecurity.com/2019/01/16/zix-appriver-acquisition/