The New York Stock Exchange welcomes Squarespace, Inc. (NYSE: SQSP), on May 19, 2021, in celebration of its Direct Listing.
NYSE
Squarespace, the website-building platform, announced on Monday it would go private in a $6.9 billion all-cash deal with private-equity firm Permira, after nearly three turbulent years on the public market.
Permira agreed to pay $44 per share in cash, a roughly 30% premium to Squarespace’s unaffected share price. In recent years, Squarespace struggled to capture public-market support: It opened below its $50 reference price in 2021 and never again traded above its $48 open price.
“We are thrilled to be partnering with Permira on this new leg of our journey,” Squarespace founder and CEO Anthony Casalena said in a release. Casalena, as well as current investors Accel and General Atlantic, control 90% of Squarespace’s voting shares. All three have approved the transaction and will continue to be investors after the Permira deal closes.
Squarespace competes with Wix and Shopify for a slice of the website-builder and e-commerce marketplace. Shares rose nearly 13% to $43 per-share in pre-market trading. Permira will finance the deal with the help of Ares Capital, Blackstone and Blue Owl.
“We are excited to partner with Anthony and his team to support the company in unlocking its full potential,” Permira partner David Erlong said in a release.
Squarespace’s move to go private marks a trend by smaller technology companies over the last two years, some of which have been burned by the public markets or believe they could create more value being amalgamated with other PE portfolio companies. Qualtrics, for example, was spun off from SAP in 2021 and was quickly taken private again in 2023 by Canada’s pension plan and Silver Lake in a $12.5 billion deal.
Japanese giant Toshiba also went private in 2023 in a $13.6 billion deal, after years of speculation and tumult, including a sustained engagement with activist investor Elliott.
Investors are keeping a close eye on the dealmaking space, after a quiet 2022 and 2023 left many late-stage companies in an IPO holding pattern. There are some signs that M&A is picking up again, and some late stage companies have already gone public or plan to do so.
Centerview, J.P. Morgan, Skadden and Richards, Layton & Finger advised Squarespace and its special committee. Goldman Sachs and Latham & Watkins advised Permira.