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SAP's in-and-out burger Qualtrics sold to Silver Lake and Canadian pension funds

Someone's still got some cash jangling about after the Silicon Valley Bank mess

Qualtrics, the experience management company briefly owned SAP, will be acquired by Silver Lake and the Canada Pension Plan Investment Board (CPP Investments).

SAP acquired Qualtrics in 2018 for $8 billion – mere days before its planned IPO. Then, adding to the intrigue, floated it in 2020.

And just three years later, Qualtrics will go private again. Silver Lake and CPP Investments announced the $12.5 billion deal on Sunday.

Silver Lake already held around four percent of Qualtrics stock. SAP also held plenty, and told investors it will happily offload its stake and expects to pocket $7.7 billion.

SAP will retain friends with benefits status with Qualtrics. Or, as SAP CEO Christian Klein put it, the German giant "intends to remain a close go-to-market and technology partner, servicing joint customers and continuing to contribute to Qualtrics' success."

Qualtrics reported its FY 2022 results on January 25, when investors were told of a 36 percent increase in annual revenue to $1.46 billion, an operating loss of $1.05 billion, but better than expected earnings per share – numbers that saw the share price pop from around $11 to over $16. The scrip had not seen that valuation since mid-2022. Silver Lake and CPP Investments will pay $18.15 apiece – a nice pay day for recent investors. Those who bought in at $44 in 2021 may feel differently about the deal.

Qualtrics's future owners will get their hands on a going concern with over 18,000 customers and an arguable leadership position in software that measures customers' perception of the quality of experiences they consume. Qualtrics asserts that measuring such perceptions allows improvement of experiences – an important feedback loop given so many products are now delivered as software.

CPP Investments emphasizes long-term investments, and Silver Lake tries to steer companies it tends to long-term growth. So maybe this won't be a case of private owners maximizing profits and looking for a quick sale. Or perhaps the new owners have seen Qualtrics endure SAP's two rapid transactions and reckon the biz can survive a third. ®

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