Shares plunge as US private equity titan backs out of Darktrace takeover
Shares tanked over 30 per cent this afternoon after the tech darling said US private equity giant Thoma Bravo would not be launching a takeover of the firm.
Thoma Bravo was rumoured to be in early-stage talks with the FTSE 250 company, which has a market cap of £2.5bn, but confirmed that it did not intend to make an offer.
In the cyber security firm’s first full year results as a public company yesterday, Darktrace CEO Poppy Gustafsson said: “Today’s results are yet another example of our strong performance. Being listed on the London Stock Exchange is exactly where we want to be right now.”
Weighing in on the news that the American suitor would no longer be interested, chief market analyst at CMC Markets UK Michael Hewson said: “For the London market the news will be a mixed blessing as it will mean that we get to keep a tech success story, however on the flip side the shares have slipped sharply as the debate continues about its business model.”
Darktrace has notably been buoyed by a shift to remote working during the pandemic as well as the Russia-Ukraine conflict, which has fuelled a spike in cyber attacks and bolstered demand for security software.
Darktrace revenue grew 45.7 per cent in the financial year to 30 June, while the customer base swelled 32.1 per cent year-over-year.
However, the firm did note an accounting mishap, stating that $3.8m of revenue it had been recognising in the full year, including a portion recognised and reported in its unaudited half year results, was related to prior periods and should instead be recognised in full year 2021 results.
This reallocation would reduce revenue reported this year to $415.5m from the $419.3m that was expected.
Shares tumbled 33 per cent this afternoon, trading at 342.90p
In an interview with Morning Wire earlier this year, CTO and founding partner Jack Stockdale noted the company’s turbulence.
“One minute you can be the tech darling, the next minute you’re not. Then, suddenly, you are again,” he told Morning Wire