What happened
Shares of Bottomline Technologies (EPAY) were up by nearly 15% as of 11:22 a.m. ET Friday after the payments company announced that it will soon be acquired in an all-cash deal.
So what
Bottomline Technologies announced that it has agreed to be purchased by private equity company Thoma Bravo for $2.6 billion in cash, valuing each share at $57. At the close of Thursday's session, the stock was trading at $48.92. It's now trading in the neighborhood of $56.21.
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"This transaction is an exciting next chapter for our company, our customers and our employees, and is a testament to the hard work and dedication of the entire Bottomline team," CEO Rob Eberle said in a statement. "We have been executing against our strategy of establishing competitive advantage with a product set designed to transform business payments for companies and financial institutions around the world."
Eberle added that the deal with Thoma Bravo, which focuses on software and tech sector companies, will enable Bottomline Technologies to invest more in the business to further its capabilities and increase its leading market position. It will also benefit from Thoma Bravo's expertise in the payments arena, he said.
Now what
The day's action here is pretty straightforward in the sense that Bottomline's stock has risen to almost the level of the buyout price. That's standard -- there's usually a slight discount on buyout targets to account for the possibility that the deal will fall through, and the opportunity cost of having money tied up in the stock until the acquisition closes -- which, in this case, is expected to happen in 2022's second quarter.