Double-Take Says Yes To California Suitor
The $242 million planned purchase of Southborough-based Double-Take Software Inc. by California-based Vision Solutions Inc. positions the merged company as a stronger player in the increasingly competitive market data backup and recovery industry, according to experts.
"This industry is getting a lot more competitive and it's not getting any easier, so I think companies that offer wider product lines are the ones that will be able to excel," said Paul Mansky of the San Francisco-based investment firm Canaccord Adams, who follows Double-Take.
Vision Solutions, which is owned by the private equity firm Thoma Bravo of San Francisco, offered $10.55 in cash for each share of Double-Take. That represents about 20 percent over the stock price on April 9, the last day before Double-Take said it was considering a takeover offer.
The deal, which was announced May 18, is expected to be closed by the third quarter.
Deal Maker
Thoma Bravo appears to be making a big play in the IT sector. It announced plans June 2 to purchase SonicWall, another computer security firm, for approximately $717 million. Some analysts are wondering if portions of all three of the companies may be combined by Thoma Bravo to offer a comprehensive data security and recovery product.
Joel Fishbein, an analyst with Lazard Capital in New York, said he thinks Thoma Bravo is strategically positioning itself with the SonicWall and Double-Take purchases.
"(Bravo) could be trying to package these companies together," Fishbein said.
According to Christian Tate, senior vice president of worldwide marketing for Double-Take, officials were not looking to sell the business. But Tate said Vision Solutions offered a "great deal."
"We created a company that's worth almost $250 million. We've got 20,000 happy customers and we were attractive enough to get a solid offer," Tate said. "This is great news for the company and it really gives us an opportunity to spread our wings."
Tate said it's unclear what impact of the deal will be on the number of employees the company has in Massachusetts.
Tate did say, however, that one advantage of combining with Vision is that the companies will be able to cross-sell each other's products.
Both companies specialize in data backup and recovery from disaster. Double-Take specifically serves customers running the Microsoft Windows operating system.
The past few years have brought changes in the Double-Take's client-base, Tate said. The company specialized in the small- and medium-sized business market, which dropped off drastically during the past two years.
Double-Take's stock reached a low of $6.35 in April 2009 but rebounded a year later to trade at $10.78.
Tate said company officials were not out soliciting offers to be purchased. He said a dip in the company stock created value.
"For companies that were on the sidelines in adjacent markets, this was a great opportunity to grab some good value," he said.
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