Boston-based development veteran Progress – beloved by greybeards for its Progress 4GL – has just spent nearly a quarter of a billion greenbacks on DevOps darling Chef.
The deal, worth $220m in cash, is schedued to close in October and the transaction "is expected to be accretive beginning in Q1 FY2021", according to Progress.
The US firm already has quite the portfolio of products, from user interface tools such as Telerik and KendoUI to cognitive services like Corticon, and of course Progress 4GL, which rebranded to OpenEdge ABL.
Founded in 2008, Chef is all about automation and has built a line-up to automate infrastructures with an eye on compliance as well as continuous application delivery. It will also plug the DevOps and DevSecOps holes in Progress's portfolio. Similar configuration management tools include the likes of Puppet and Saltstack.
Chef has picked up $105m in funding since it was founded in 2008. The latest round saw $40m poured into the company in 2015, when Chef was valued at $360m. The recurring annual revenue of the privately held company stands at $70m.
That $70m will have appealed to Progress as it seeks to grow through "accretive acquisitions" that add both scale and cashflow. Chef's bauble cabinet is also festooned with awards nodding toward its DevOps smarts.
"This acquisition perfectly aligns with our growth strategy," effused Progress CEO Yogesh Gupta, "and meets the requirements that we've previously laid out: a strong recurring revenue model, technology that complements our business, a loyal customer base and the ability to leverage our operating model and infrastructure to run the business more efficiently."
Progress's revenues have remained near-flat between 2019 and 2020, and according to preliminary results in the three months ending 31 August 2020 it turned over between $107.8m and $109.8m in sales, between 1 and 3 per cent up on the same period in 2019. Revenue for the whole of FY2020 is expected to be between $438m to $442m and Chef is anticipated to contribute between $5m and $7m to the top line.
Chef's CEO, Barry Crist, referred to the acquisition as the "Fourth Chapter of Chef." Crist went on to reassure customers that Chef would carry on as normal until the deal closes. Once the deed was done, "Progress will be focused on continuing and executing on Chef’s business model and product roadmaps."
It has been just over a year since Progress spanked $225m in cash on the purchase of network management outfit Ipswitch and nearly six years since the 2014 $262.5m purchase of Telerik. ®