TeamViewer, developers of the remote access Windows productivity software, is planning to tap the German capital markets before the year is out. This is going to be reportedly one of the largest IPOs in technology in Germany in over two decades. According to the Financial Times, a source close to the matter stated the offer would value the company at a cool $4.4 billion.
TeamViewer’s owner Permira will sell shares to the tune of 30% to 40% of the company. This is good news for the declining IPO market in Europe on account of global trade uncertainty and Brexit headwinds. The slump in the market could improve given the large amount being raised although the company itself did not specify its target.
TeamViewer Surging Ahead
As to why the company was going ahead with the IPO in the current international and European financial climate the CEO of TeamViewer, Oliver Steil , had the following to say “It is hard to pick the right moment in time but our big growth combined with strong profitability, even if market conditions have been difficult, makes our financial profile attractive to investors” and he said further “There is a lot going on in the space and it’s still a bit early, but we will see more tech players emerge in a few years”.
There is a good reason for the CEO’s confidence in his firm’s financial performance. TeamViewer was bought out by Permira in 2014 for 870 million euros and has since courted partnerships with Alibaba Group Holding Ltd. (NYSE:BABA) and Salesforce.com Inc. (NYSE:CRM) to enhance its cloud portfolio. Moreover, it has experienced rapid growth of paid subscribers – the company claims its software features on over 2 billion devices worldwide. In the first half of the current fiscal, its cash billings grew more than 35% compared to 25% over the same period last year. This is a very solid performance for an established player with a large global base. The company said it expected annual growth of 35% to 39% and EBITDA (earnings before interest, taxes depreciation and amortization) as high as 183 million euros.
Going the IPO route will allow Permira to retain a controlling stake in TeamViewer (as previously said Permira is only looking to sell 30% to 40% of the company) and Oliver suggested remaining independent was key for the company’s future. “Going down the IPO route versus selling means that we can remain an independent player, and it is important for us to sustain our independence.” He was quoted as saying.
Permira has tapped Goldman Sachs (NYSE:GS) and Morgan Stanley (NYSE:MS) to arrange the IPO.