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Will Thoma Bravo Outperform the Real Estate Market After Acquiring Real Page?

In December 2020, RealPage, Inc. declared that Thoma Bravo had bought it in a cash deal of roughly $10.2 billion, including net debt. 

Under the terms of the settlement, the Stockholders of the RealPage will get $88.75 in cash per share of Real Page ordinary shares after the deal terminates.

The acquisition cost constitutes a premium of 30.8% over Real Page's closing stock value of $67.83 on December 18, 2020, a 36.5% premium over Real Page's 30-day volume-weighted aggregate equity price by that date. On December 7, 2020, a 27.8% premium over its highest share value touched till date of $69.47.

Thoma Bravo is a private equity giant based on the software and technology-driven services sectors. Founded in 2008, Thoma Bravo has purchased more than 270 software and technology firms, generating over $79 billion in net worth through its buy and build investment policy.

The firm collaborates with their management team to incorporate operating best practices, drive innovations, and make additive purchases. Headquartered in Chicago, Thoma has an additional office in San-Francisco.

Real Page outperforms as a topmost global provider of property management software to the real estate industry. This technology platform was founded in 1988, listing on the NASDAQ GS: RP with a market capitalization of $8.861 billion.

The company concentrates on helping its clients obtain clarity by leveraging data insights, asset performance, and enlarging capital returns. Its headquarters is in Richardson, Texas. The Real page also assists 12,200 customers worldwide from offices in North America, Europe, and Asia.

How does this acquisition benefit both the companies?

Thoma Bravo has a record of purchasing cutting-edge software distributors for generic industries and fostering their innovation and progress while staying loyal to their core business and customers. This deal would be the major to date for Thoma, that handles more than $73 billion.

According to the founder of Thoma Bravo, Orlando Bravo, Real Page has an enormous potential to go forward as its platform is very significant in the real estate ecosystem. The partnership of these two renowned firms can:

  • Broaden Thomas's market offerings, and
  • Develop its existing potential to capitalize on the extremely sophisticated real estate market.

The CEO and Chairman at Real Page, Steve Winn, believes that this transaction will boost his team's ability to emphasize implementing their long term plans. Furthermore, it will help their clients and partners with improved products and services.

Since 2003, Thoma Bravo has been outperforming its customers and has earned a 3.7x gross money multiple and 49.6% gross internal rate of return on realized investments, according to documents composed for Pennsylvania State Employees' Retirement System.

As per reports, Thoma had generated three funds worth more than $22.8 billion. Seeing the remarkable past performances of Thoma and the best quality products of Real Page, it is quite obvious that Thoma will outperform the real estate market after this acquisition.

The agreement, accepted officially by the board of directors of Real Page, is scheduled to close in the second quarter of 2021 and turn RealPage into a privately owned company.

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