QADB Stock Price Increases Over 75%: Why It Happened

By Amit Chowdhry ● June 28, 2021
  • The stock price of QAD Inc. (NASDAQ: QADB) increased by over 75% during intraday trading. This is why it happened.

The stock price of QAD Inc. (NASDAQ: QADB) – a leading provider of next-generation manufacturing and supply chain solutions in the cloud – increased by over 75% during intraday trading. Investors are responding QAD announcing that it has entered into a definitive agreement to be acquired by Thoma Bravo in an all-cash transaction with an equity value of approximately $2 billion. Under the terms of the agreement, QAD shareholders will receive $87.50 per share of Class A Common Stock or Class B Common Stock in cash.

Upon the completion of the deal, QAD is going to become a private company with the flexibility to continue investing in the development and deployment of Enterprise Resource Planning (ERP) software and related enterprise software for manufacturing companies around the world. And Anton Chilton will continue to lead QAD as CEO. Plus the company will maintain its headquarters in Santa Barbara, California.

The QAD Board of Directors had formed a Special Committee composed entirely of independent directors to conduct a robust process and negotiate the transaction with the assistance of independent financial and legal advisors. And following the Special Committee’s unanimous recommendation, members of the QAD Board other than Lopker (who recused herself) unanimously approved the merger agreement with Thoma Bravo, and recommend that QAD shareholders adopt and approve the merger agreement and the transaction.

The deal is expected to close in the fourth quarter of 2021, subject to the satisfaction of customary closing conditions, including the approval of owners of the majority of QAD shares not held by Lopker, her affiliates, and other directors and officers of the company. Following the closing of the deal, Lopker intends to retain a significant ownership interest in the Company and will continue to serve on the QAD Board.

KEY QUOTES:

“Today’s announcement, which is the culmination of a comprehensive process, represents a compelling opportunity to build on QAD’s impressive legacy and strong momentum while maximizing value for shareholders. Thoma Bravo has a deep appreciation for the world-class team, reputation and portfolio we have built at QAD, and with their strong support we are excited to take our business to the next level. As a private company owned by Thoma Bravo, we will have enhanced flexibility, focus and resources to invest in – and capitalize on – our expanding growth opportunities, and help our customers thrive in an increasingly dynamic manufacturing environment.”

— Anton Chilton

“Over the past four decades, we’ve grown QAD from a locally sourced, one-person start-up to a leading, trusted global provider of ERP solutions. Today we are beginning our next chapter of growth. Since QAD’s founding in 1979, our customers, our technology and the manufacturing industry have evolved significantly – and, at every step, QAD has adapted swiftly to maintain and build our leadership position. Global manufacturers are facing ever-increasing challenges, and we are pleased that our customers around the world can continue to rely on QAD’s next generation solutions to keep pace with emerging business disruptors. Through this partnership, we will be even better positioned to build on our strong foundation and enhance our value proposition.”

— QAD Founder and President Pamela Lopker

“For more than a decade, we have admired QAD’s unparalleled history of delivering innovative solutions focused on the needs of global manufacturers. As the pace of change continues to accelerate and supply chains become more complex, we are committed to supporting QAD in delivering its vision and ensuring the Company is well equipped to further expand its reach and portfolio. We look forward to partnering with Anton and his team to cement the Company’s positioning as the intelligent, agile, and innovative partner of choice for Adaptive Manufacturing Enterprises.”

— Scott Crabill, a Managing Partner at Thoma Bravo

“Thoma Bravo has a strong track record of helping enterprise software businesses evolve their platforms to meet the needs of clients and we are excited about QAD’s future given its exceptional foundation and history. We will plan to leverage our deep expertise in software to support the company’s talented team to further the journey to SaaS and to drive sustainable long-term growth both organically and through M&A.”

— Peter Stefanski, a Principal at Thoma Bravo

Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.