Investor group backs buyout offer for Exclusive Networks SA

A nonbinding offer to take the French cybersecurity company Exclusive Networks SA private has been made by an investor group led by Clayton Dubilier & Rice, and Permira, according to sources with regard to the matter, for approximately $2.4 billion in its valuation.

Under the recommended deal, an offer price for shareholders would be €24 per share, according to Exclusive Networks in a statement, confirming an earlier Bloomberg News report. It is not certain that a deal will materialise as discussions are still at play.

The prospective buyer, the private equity group, has arranged financing that could be utilised to buy out minority shareholders in Exclusive Networks if it wants, said the people familiar with the matter who insisted on anonymity because the discussions are private.

Deal activity in the cybersecurity industry has been gaining steam over the years after a spate of high-profile security breaches. Permira, for example, announced a deal in May for Israeli fraud protection firm BioCatch. More recently, CyberArk Software Ltd. agreed to acquire Venafi, a company backed by Thoma Bravo, and cloud security firm Wiz Inc. reached a valuation of $12 billion in its latest funding round.

Exclusive Networks' shares surged 8.3 per cent to €23.60 in early Paris trading following the announcement. The stock was up 12 per cent this year through Monday's close. Permira is already the company's biggest shareholder, holding more than half of the company's issued shares, according to Bloomberg data.

These discussions have occurred in the aftermath of France's election, where a coalition of left-wing parties won the most seats in the National Assembly but fell short of securing an absolute majority—a political stalemate likely to frustrate more transactions in France because some investors will be wary of executing any deal during such uncertainty.