On Monday, Squarespace, the website-building platform, announced its decision to transition into a private entity through a $6.9 billion all-cash acquisition deal with private equity firm Permira, concluding nearly three eventful years on the public market.
Under the agreement, Permira will acquire Squarespace for $44 per share in cash, representing a substantial premium of approximately 30% over Squarespace’s unaffected share price.
Squarespace had faced challenges garnering public-market support in recent years, with its stock opening below its $50 reference price in 2021 and never surpassing its $48 open price thereafter.
In response to the deal, Squarespace founder and CEO Anthony Casalena expressed enthusiasm, stating, “We are thrilled to be partnering with Permira on this new leg of our journey.”
Casalena, along with existing investors Accel and General Atlantic, collectively holding 90% of Squarespace’s voting shares, have all endorsed the transaction and will remain investors post-acquisition.
Squarespace operates in the competitive space of website-building and e-commerce, contending with rivals such as Wix and Shopify.
Following the announcement, Squarespace shares surged nearly 13% to $43 per share in pre-market trading. Permira plans to finance the acquisition with assistance from Ares Capital, Blackstone, and Blue Owl.
David Erlong, a partner at Permira, expressed enthusiasm for the partnership, stating, “We are excited to partner with Anthony and his team to support the company in unlocking its full potential.”
Squarespace’s decision to go private reflects a broader trend among smaller technology companies over the past couple of years, with some opting to depart from public markets due to challenges or in pursuit of greater value through consolidation with other private equity portfolio companies.
Notable examples include Qualtrics, which was spun off from SAP in 2021 and subsequently privatized in 2023, and Toshiba, which went private in a $13.6 billion deal in 2023.
With the deal-making space attracting investor attention, particularly following a subdued period in 2022 and 2023, there are indications of renewed M&A activity, with some late-stage companies opting for IPOs or considering them.
Advising Squarespace and its special committee were Centerview, J.P. Morgan, Skadden, Richards, Layton & Finger, while Goldman Sachs and Latham & Watkins advised Permira.
