Private Equity Firm Thoma Bravo to Acquire Insurance Software Firm Majesco for $594M

July 20, 2020

Cloud insurance software firm Majesco said it has agreed to be acquired by Thoma Bravo, a private equity firm focused on the software and technology services sectors, in a transaction valuing the company at $594 million.

Following the closing of the transaction, Majesco said it will operate as a privately-held company.

Under the terms of the agreement, all Majesco shareholders will receive $13.10 in cash for each share of Majesco common stock, a price representing a premium of approximately 74% over Majesco’s average closing price during the 30-trading day period ended July 17, 2020.

Upon completion of the transaction, Majesco expects to continue to operate under the leadership of CEO Adam Elster and the existing Majesco leadership team.

“Our decision was made with the best interests of our stockholders and we believe that the transaction will also benefit our 2,400+ employees and our more than 200 customers,” said Elster.

Elster said the added flexibility Majesco will have as a private company, combined with the benefit of Thoma Bravo’s knowledge and expertise, will allow it to more effectively focus on “long-term investment and growth objectives, to the benefit of our employees, customers and partners.”

“We see Majesco as a leader in helping its insurance customers get to the cloud faster, and modernize their internal and external facing systems,” said A.J. Rohde, a partner at Thoma Bravo.

Thoma Bravo has a series of funds with more than $45 billion in capital commitments. Its current portfolio includes JD Power, Riskconnect and iPipeline. The firm has offices in San Francisco and Chicago.

New Jersey-based Majesco provides technology for property/casualty, life, annuity and group insurance companies. Founded in 1982, it has grown in part though acquisitions of tech firms including STG, Agile, Exaxe, InsPro and Cover-All. It reported $146.4. million in revenues for fiscal year 2020, a 3.6% increase over 2019. Net income came in at $9.7 million, up 45% over 2019. Its P/C insurance customer roster includes Chubb, Munich Re, Swiss Re, State Farm, Liberty Mutual, Great American, Allstate and QBE.

Majesco expects the merger to close on or before the end of 2020. The proposed merger is subject to the approval of Majesco shareholders and the approval of the shareholders of Majesco’s parent company, Majesco Limited. Majesco’s board of directors has unanimously approved the merger and recommends that shareholders approve the merger and Majesco Limited’s board of directors has unanimously approved the divestment of Majesco and recommended to its shareholder to approve the transaction.

Nomura Securities International is acting as financial advisor to Majesco, and Sheppard, Mullin, Richter & Hampton and Khaitan & Co. are acting as legal advisors to Majesco and Majesco Limited, respectively. Kirkland & Ellis is acting as legal advisor to Thoma Bravo.

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