Tag: Accel-KKR

KANA Software sharpening M&A blade, acquires Ciboodle

1 Comment

Contact: Thejeswi Venkatesh, Ben Kolada

Since being taken private by Accel-KKR in early 2010, KANA Software has revved its M&A engine. On Tuesday, KANA announced its fourth acquisition since its take-private, picking up call-center software veteran Ciboodle from Sword Group to bolster its agent desktop, business process management and social CRM capabilities. The Ciboodle buy is KANA’s latest deal as it inorganically moves to become a more robust platform for customer-centric support processes across channels and devices.

KANA’s acquisitions have focused on adding social capabilities to its platform and better serving the SMB market. In April 2011, the company bought social media monitoring company Overtone. KANA then integrated the target’s social analytics and infused key areas of its core platform with its own social CRM capabilities, resulting in a simple-to-use tool for support agents to identify issues or receive service requests via popular social networks. Last April, in an attempt to better serve the midmarket, KANA added more cloud clout by reaching for Trinicom. Arma Partners, which advised KANA on its acquisition of Lagan Technologies in October 2010, advised the company again on the Ciboodle purchase. We’ll have a longer report on KANA’s Ciboodle buy in tonight’s Daily 451.

KANA M&A since its take-private by Accel-KKR

Date announced Target Target abstract
July 10, 2012 Ciboodle Call-center software provider
April 24, 2012 Trinicom Customer service automation SaaS
April 5, 2011 Overtone Social media monitoring SaaS
October 6, 2010 Lagan Technologies Call-center software provider

Source: The 451 M&A KnowledgeBase

For more real-time information on tech M&A, follow us on Twitter @MAKnowledgebase.

 

Kana: bidding while the cash burns

Brenon Daly

Contact: Brenon Daly

The progression from spurned bidder to shareholder activist isn’t all that unusual. But it is unusual when the party smarting is a publicly traded company, and decides to express its agitation through press releases. Yet, that’s exactly how Chordiant Software is venting its frustration over not landing Kana Software, with Chordiant telling the world earlier this week that it plans to vote its shares (amounting to 4% of the total equity outstanding) against the proposed sale of Kana’s operating business to midmarket buyout firm Accel-KKR. Chordiant followed that up on Thursday evening with a new cash-and-stock offer that values Kana higher than the buyout bid.

All of this comes just days before shareholders are slated to vote on Accel-KKR’s offer (the vote is scheduled for Wednesday). Kana’s board continues to recommend that shareholders back the planned transaction, which would effectively carve the business out of Kana and leave only a shell company in its place. We have noted that it’s an imperfect structure, but one that probably serves the fundamentally flawed firm reasonably well. Of course, some shareholders (including Chordiant) don’t agree, and should vote however they want. We would only note that while the two sides argue, Kana continues to burn cash. At the end of its most-recent quarter (ending September 30), the company was down to just $1.8m (it started the year with $7m). While the cash burn is nothing new for Kana, which has lost $4.3bn since its inception, it could become pressing: Kana noted in its proxy that it has a $5.4m debt payment coming due in 2010.

At long last, Kana gets gone

Brenon Daly

Contact: Brenon Daly

Exactly three years ago, we bluntly wrote that there was no reason for Kana Software to be a public company, at least in its current form. Kana’s performance in the intervening 1,000 days since we published that report did nothing to change our view. If anything, as the red ink continued to gush at Kana, we became even more convinced of the need for a sale of the customer support software vendor. The sale finally happened Tuesday, with Accel-KKR agreeing to pay $49m in cash for most of Kana.

We were hardly alone in our assessment that Kana – a money-burning, Bulletin Board-listed company that also had negative working capital – should be cleared off the exchange. As we noted earlier this summer, Kana’s largest shareholder also wanted something to change at the company. KVO Capital Management, which had owned some 8.5% of the company, was pushing earlier this summer to get a director on the Kana board. KVO, which declined to comment, has agreed to back the sale to the buyout group, according to the release.

A bid and a raise for SumTotal

Brenon Daly

Contact: Brenon Daly

The sum total of all interested parties in SumTotal Systems may well be greater than the two that have already disclosed themselves. At least that’s the thinking among investors – or rather, speculators – in the learning management software vendor. Recall that earlier this month, Vista Equity Partners tossed the struggling company an unsolicited offer of $3.25 for each share. (Vista is being advised by Union Square Advisors.) As we noted, the bid included a ‘go-shop’ provision.

SumTotal never got back to Vista on its offer, but it did throw its arms around a slightly richer one from Accel-KKR on Friday. The white knight bid $3.80 for each SumTotal share, valuing the company at about $124m, or $20m more than Vista’s offer. However, we would note that SumTotal shares have traded slightly above Accel-KKR’s offer price since the bid was unveiled. (On Monday afternoon, SumTotal stock was changing hands at $3.85.) Like Vista’s initial offer, Accel-KKR’s included a go-shop provision. On that front, it seems like the shopping may not be done for SumTotal.