Cloudera to Go Private in $5.3 Billion Deal

The company is betting that private equity investment will boost its turnaround efforts in the competitive data management software space.
Matthew HellerJune 2, 2021

Cloudera has agreed to be acquired by KKR and Clayton, Dubilier & Rice for $5.3 billion in a bet that private equity investment will boost its turnaround efforts in the competitive data management software space.

The acquisition announced on Tuesday will take Cloudera private after four years as a public company during which, according to The Motley Fool, it has struggled to compete against larger, better financed rivals such as Amazon Web Services and Microsoft’s Azure.

“Cloudera was in the midst of a multiyear turnaround but faced pressure from billionaire investor Carl Icahn, who owns over 18% of Cloudera stock and has two seats on the board of directors,” The Motley Fool noted.

Under the terms of the deal, KKR and Clayton Dubilier will pay $16 a share for Cloudera, representing a roughly 24% premium to the closing price on Friday.

“We believe that as a private company with the expertise and support of experienced investors such as CD&R and KKR, Cloudera will have the resources and flexibility to drive product-led growth and expand our addressable market opportunity,” Cloudera CEO Rob Bearden said in a news release.

Cloudera was an early player in the open-source software framework Hadoop, which enables large amounts of data to be processed quickly. In 2018, it merged with Hortonworks, another Hadoop startup, in a $5.2 billion deal.

“Data management is intensely competitive, and Cloudera found its on-premise open source software at a disadvantage as enterprise-level customers continuously moved their data to the cloud,” The Motley Fool said.

In September 2019, the company launched the hybrid Cloudera Data Platform, which runs on any combination of public or private clouds, and recent results have shown improvement. For the fiscal year ended Jan. 31, Cloudera reported that revenue increased 9% to $869 million.

“The company has made significant progress establishing the Cloudera Data Platform as a leader in hybrid and multi-cloud analytics, and we believe that our experience and capabilities can offer valuable support to accelerate expansion into new products and markets,” said Jeff Hawn, a CD&R partner who will serve as chairman of Cloudera.

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