Progress Announces Impending Acquisition of ShareFile

Progress, the trusted provider of Artificial Intelligence (AI)-powered infrastructure software, has announced a definitive agreement to acquire ShareFile, a business unit of Cloud Software Group, Inc., providing SaaS-native, AI-powered, document-centric collaboration, focusing on industry segments including business and professional services, financial services, healthcare, and construction.

“Businesses today need to enhance their effectiveness in serving customers, while continuously streamlining their operations to drive efficiency, security, and compliance,” said Yogesh Gupta, CEO at Progress. “ShareFile fits strategically with Progress’ Digital Experience portfolio to enable organisations to deliver more effective client and team collaboration while simplifying the secure sharing of documents and other content. ShareFile customers will benefit from Progress’ strong customer focus, expansive product portfolio and expertise as well as an unparalleled track record of customer success.”

Acquisition of ShareFile to Expand Progress’ Many Capabilities

Progress products help organisations to develop, deploy, and manage responsible AI-powered applications and experiences. Upon closing of the transaction, ShareFile will add to these capabilities with SaaS-native, AI-powered document-centric collaboration and workflows, client portal, secure file sync and share and eSignature.

“ShareFile has a long track record of success within the secure content collaboration and client interaction space and with this transaction, as part of Progress, will be better positioned to continue that record, long into the future,” said Thomas Krause, CEO at Cloud Software Group. “For ShareFile customers, we firmly believe they will benefit from Progress’ deep customer commitment, extensive product portfolio, expertise, and its expansive user community.”

The proposed acquisition of ShareFile is another example of the continued execution of Progress’ Total Growth Strategy. Progress continues to maintain financial discipline while seeking to acquire strong businesses with products that complement its existing software portfolio, include a robust customer base with strong retention rates and solid recurring revenue, and align with its company culture. ShareFile is expected to add more than USD $240 milliom in annual revenue and more than 86,000 customers to Progress.

Reiterating Guidance

Based on currently available information, Progress anticipates revenue and non-GAAP earnings per share for its fiscal third quarter will be within or above the high end of previously issued guidance provided on 25 June 2024. The company will discuss the full financial results of its third quarter on a conference call on 24 September 2024.

Transaction Details

Subject to the satisfaction of the terms and conditions set forth in the definitive agreement, Progress is expected to acquire ShareFile for USD $875 million, paid for with a combination of cash and Progress’ existing revolving credit facility. The acquisition is currently expected to close within Progress’ fiscal year, ending 30 November 2024, subject to obtaining regulatory approvals and satisfaction of other customary closing conditions set forth in the definitive agreement.

Citi is serving as the exclusive financial advisor for Progress on this transaction while DLA Piper LLP (US) is serving as Progress’ legal counsel. Jefferies LLC and Barclays are serving as financial advisors to Cloud Software Group while Kirkland & Ellis LLP is serving as legal counsel.

Progress hosted a conference call recently to review the details of the acquisition. The webcast can be accessed at: https://edge.media-server.com/mmc/p/o8nk7hby/. Attendees must register for the webcast and an archived version of the conference call and supporting materials will be available on the Progress Investor Relations webpage.