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Thoma Bravo is set to buy the trading software group Calypso, in a deal that values the San Francisco-based company at $3.75bn, according to two people familiar with the matter.
The US-based buyout group, which specialises in software deals, will acquire the firm at a hefty valuation of 37 times the $100m that Calypso generated in earnings before interest, tax, depreciation and amortisation in the year to December 2020.
The deal underlines how a rush of private equity money into the technology sector in recent years has driven up valuations. The sector accounted for 28 per cent of all private equity deals by value in 2020, according to figures from Refinitiv, as the pandemic increased the appeal of tech companies.
Calypso, which sells capital markets software to banks, asset managers and clearing houses, was valued at about $800m in March 2016, when it was acquired by private equity groups Bridgepoint and Summit Partners, a person familiar with the matter said.
Since then it has switched customers from one-off licenses to software subscriptions, which provide the recurring revenues that are highly prized by buyout groups.
Thoma Bravo was behind the largest private equity-backed tech deal of 2020, buying US property software group RealPage in a $10.2bn acquisition in December.
The companies did not immediately respond to a request for comment.
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