EQT snaps up API and id administration software program firm WSO2 for greater than $600M

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WSO2, an organization that gives API administration and id and entry administration (IAM) providers for enterprises, has been acquired by Swedish funding big EQT.

Phrases of the deal weren’t disclosed, however TechCrunch has realized through sources that the deal values WSO2 at “greater than” $600 million, with EQT attaining a “vital majority” stake for the worth.

WSO2’s merchandise embrace an open supply API supervisor, corresponding to one thing like Google’s Apigee, which companies use for constructing and integrating all their digital providers, both within the cloud or on-premises. The corporate provides tangential providers comparable to API administration particularly for Kubernetes, in addition to its flagship Identification Server — just a little one thing like Okta — that firms use for managing id and entry performance of their apps, comparable to single sign-on (SSO).

WSO2, which was based out of Sri Lanka in 2005, had raised round $130 million in funding from the likes of Intel, Cisco and Goldman Sachs, with its most up-to-date tranche coming through a $93 million Sequence E spherical in 2022. An official valuation was by no means introduced, however articles from some retailers on the time reported a valuation of greater than $600 million. So that may imply WSO2 has remained considerably stagnant, although the “greater than” side right here may disguise some motion within the firm’s valuation.

A powerful observe document

WSO2 co-founder and CEO Sanjiva Weerawarana has a robust observe document within the open supply sphere, significantly amongst Apache Software program Basis tasks, and he was one of many essential designers of the cloud-native Ballerina programming language. Since 2017, Weerawarana additionally drives for Uber, which he says is designed to “problem the norm” and make it extra socially acceptable in his native Sri Lanka.

WSO2 is a reasonably well-distributed firm, in step with the ethos of different companies based round open supply. Whereas the corporate counts a U.S. HQ in Santa Clara, and lots of of its senior management group are unfold throughout the U.S., its middle of gravity lies in Sri Lanka the place a lot of its workforce is situated — together with Weerawarana, who’s primarily based within the capital Colombo.

With that in thoughts, it’s value noting that the acquisition was truly made by an EQT subsidiary known as EQT Non-public Capital Asia, previously often known as Baring Non-public Fairness Asia, which EQT procured in 2022 for €6.8 billion to function its non-public fairness automobile for Asia.

With a worldwide unfold of shoppers that embrace AT&T, Honda and Axa, that is one thing that EQT Non-public Capital Asia associate Hari Gopalakrishnan says was a key a part of its choice to speculate. Furthermore, with cloud computing and AI driving demand for safety infrastructure, WSO2 was a very interesting proposition for an funding agency with latest type within the enterprise software program area.

“Software program is a key focus sector for EQT, and WSO2 is a robust firm that has scaled globally with an enterprise buyer base unfold throughout the US and Europe,” Gopalakrishnan mentioned in a assertion. “[We] imagine that the corporate is well-positioned to capitalize on long-term developments comparable to digital transformation and rising GenAI adoption.”

EQT say that it expects the acquisition to shut within the second half of 2024.



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