Tufin Software Technologies (TUFN) Stock: Why The Price Surged Today

By Amit Chowdhry ● Apr 6, 2022
  • The stock price of Tufin Software Technologies Ltd (NYSE: TUFN) increased by over 42% during intraday trading today. This is why.

The stock price of Tufin Software Technologies Ltd (NYSE: TUFN) – a company pioneering a policy-centric approach to security and IT operations – increased by over 42% during intraday trading today. The stock price increased since Tufin announced that it has entered into a definitive agreement to be acquired by Turn/River Capital, a software-focused investment firm, in an all-cash transaction that values Tufin at approximately $570 million.

Under the terms of the agreement, Tufin shareholders are going to receive $13 per share in cash, representing a premium of approximately 44% over Tufin’s closing share price on April 5, 2022, the last full trading day prior to the transaction announcement, and a premium of approximately 54% over Tufin’s one-month volume-weighted average closing price through April 5, 2022. And upon completion of the transaction, Tufin will become a private company and will partner with Turn/River to further accelerate its mission of helping enterprise customers use policy-driven automation to address the security threats of tomorrow.

Transaction Details

Tufin’s Board of Directors unanimously approved the agreement with Turn/River Capital and recommends that Tufin shareholders vote in favor of the transaction at the Special Meeting of Stockholders to be called in connection with the transaction.

The agreement includes a 30-day “go-shop” period expiring May 5, 2022 – which enables the Board and its advisors to actively solicit, initiate, encourage or facilitate alternative acquisition proposals from third parties. And the Board will have the right to terminate the merger agreement to enter into a superior proposal subject to the terms and conditions of the merger agreement. There can be no assurance that this “go-shop” will result in a superior proposal, and Tufin does not intend to disclose developments with respect to the solicitation process unless and until it determines such disclosure is appropriate or otherwise required.

The deal is expected to close in the second quarter of 2022, subject to customary closing conditions, including approval by Tufin shareholders and receipt of regulatory approvals. And upon closing of the transaction, the Company’s common stock will no longer be listed on any public market. The Company will continue to be headquartered in Tel Aviv, Israel.

Ruvi Kitov, Chairman, CEO and Co-Founder of Tufin and Reuven Harrison, CTO and Co-Founder of Tufin, have entered into voting agreements pursuant to which they have agreed, among other things, to vote their shares of company common stock in favor of the transaction.

KEY QUOTES:

“Today’s announcement is a testament to Tufin’s leadership in security policy management for hybrid networks and cloud environments. Since our inception nearly 20 years ago, we have made significant strides in developing our policy-based automation solution and have become a market leader. This deal represents an important milestone for Tufin, and as a private company, we will have the opportunity to accelerate our growth through investments in our technology, people, and go-to-market. The team at Turn/River specializes in helping software companies like Tufin, and with their partnership and expertise I am confident that we will be able to achieve our long-term goals faster.”

— Ruvi Kitov, Chairman, CEO, and Co-Founder of Tufin

“We believe Turn/River Capital is the ideal partner for Tufin as the Company makes further progress to a subscription-based revenue model. We are confident this transaction with Turn/River will allow Tufin to accelerate this transition, expand to new markets, and reach new customer segments.”

— Tom Schodorf, the Lead Independent Director of the Tufin Board of Directors

“Tufin is an industry leader in network security policy management, helping enterprise customers secure their most critical network infrastructure and cloud assets. We are incredibly excited to bring our best-in-class operations team, with their deep expertise in marketing, sales, and customer success, to our partnership with Tufin. We look forward to working hand in hand with them to drive accelerated growth and scale.”

— Dominic Ang, Founder and Managing Partner of Turn/River Capital

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