Escalation of PE Take-Privates: A Catalyst for Middle-Market M&A Momentum
Recent developments in the software M&A landscape, particularly Thoma Bravo’s agreements to take Dayforce and Verint private, offer compelling evidence of accelerating activity that holds significant implications for the middle-market.
On August 21, 2025, Thoma Bravo announced a definitive agreement to acquire Dayforce, a global leader in human capital management (HCM) technology, for US$12.3bn in an all-cash take-private transaction. Shareholders will receive US$70 per share, reflecting a 32 percent premium to the unaffected closing stock price before deal chatter surfaced. Thoma Bravo emphasized that the transaction is intended to accelerate Dayforce’s growth trajectory, enhance customer value, and reinforce its leadership in AI-driven HCM solutions.
Shortly thereafter, on August 25, 2025, Thoma Bravo agreed to acquire Verint Systems, a prominent customer-experience (CX) automation provider, in an all-cash transaction valued at approximately US$2.0bn. Verint shareholders will receive US$20.50 per share, representing an 18 percent premium to the company’s 10-day volume-weighted average share price before sale discussions surfaced. The deal is projected to close before the end of Verint’s fiscal year, subject to standard approvals. Thoma Bravo plans to merge Verint with Calabrio, another portfolio company in its CX stack, aiming to create an AI-enabled powerhouse in CX automation.
A Bullish Signal for M&A Activity and Market Confidence
From our perspective, these transactions serve as a clear, positive signal that private equity firms continue to view software companies, particularly those with strong AI capabilities, as fertile ground for investment, even amid macroeconomic uncertainty.
Valuation confidence: The substantial premiums of 32 percent (Dayforce) and 18 percent (Verint) affirm deep investor conviction in long-term growth, especially in AI-enabled HR tech and CX platforms.
Sector momentum: HCM and CX remain high-growth verticals. Thoma Bravo’s willingness to invest bold capital signals that strategic value creation through digital transformation remains front of mind.
Operational focus under private ownership: Taking high-growth SaaS assets private affords greater strategic flexibility, with reduced public scrutiny and more room for transformative product and go-to-market investment.
Implications for the Middle Market: The "Trickle-Down" Effect
The activity at the high end is already cascading into the middle market, raising the bar for competition, pricing, and deal sophistication. We see several key ramifications:
Increased competitive tension: The spate of high-profile deals raises anxiety, and opportunity, among buyers and sellers. Now, even middle-market transactions may attract multiple suitors, including trade buyers and PE firms looking for "roll-up" platforms or vertical consolidation.
AI and tech enrichment as differentiators: AI-enabled capabilities are increasingly a must-have in software targets. Those middle-market firms proactively embedding automation, analytics, or AI into their platforms may find themselves more desirable to sponsors or strategic acquirers.
Deal structuring creativity increases: As capital becomes more readily available for high-velocity growth, middle-market deals may begin featuring more sophisticated structures, such as earn-outs, minority recapitalizations, or growth capital injections, rather than traditional all-cash buyouts.
Greater emphasis on strategic premium payers: PE firms, emboldened by successful large-cap take-privates, might increasingly compete with strategics in middle-market deals, especially in software, driving up pricing and pushing sellers to thoughtfully vet buyer landscapes.
At Sampford Advisors, this environment reinforces our ongoing observation: the middle market is seeing heightened M&A velocity and valuation discipline, with buyers expecting software assets to be not only stable cash generators but also engines of innovation, particularly via AI-powered features.
Alignment with Our Internal Outlook
Internally, we've observed increasing inbound interest from both strategic and financial acquirers in mid-market software platforms displaying:
Recurring revenue models with healthy retention metrics
Scalable AI or analytics capabilities, especially those addressing workforce management or CX automation
Strong customer loyalty and net-promoter momentum
These attributes mirror the value synergies evident in the Dayforce and Verint plays, indicating to us that the themes driving large-cap transactions are already resonating at lower levels of the market.
Conclusion: A Momentum Window for Sellers and Sponsors
Thoma Bravo’s twin plays, Dayforce in HCM and Verint in CX, offer a compelling proof point of robust buyer appetite, strategic consolidation strategies, and premium pricing anchored in AI-driven value creation. For middle-market software firms, this spells heightened opportunity, but also intensifying expectations.
At Sampford Advisors, we anticipate this environment will catalyze activity across deal sizes, encourage more nuanced deal structures, and elevate the importance of AI-enabled differentiation. This moment represents a strategic window for well-positioned founders, boards, and sponsors to explore value realization or build for scale, whether via take-private, growth investments, or M&A exits grounded in innovation.