Demandware (DWRE) to be acquired by Salesforce (CRM)

Demandware to be acquired by Salesforce (CRM) for $75.00/share in cash :

• Salesforce (CRM) will acquire Demandware in a transaction worth ~$2.8 bln (net of cash acquired). Under the terms of the agreement, Salesforce will commence a tender offer for all outstanding shares of Demandware for $75.00 per share, in cash. The transaction is expected to close in the second quarter of Salesforce's fiscal year 2017, ending July 31, 2016.
• The transaction is expected to close in the second quarter of Salesforce's fiscal year 2017, ending July 31, 2016. Following the successful completion of the tender offer, Demandware shares not tendered in the tender offer will be converted in a second step merger into the right to receive the same $75.00 per share in cash paid in the tender offer.

Updated Guidance:

• FY17 Revenue: The acquisition is expected to increase Salesforce's FY17 total revenue by approximately $100 mln to $120 mln.
  • This estimate reflects an approximately $50 mln reduction relating to fair value adjustments to deferred revenue and unbilled deferred revenue, adjustments related to the combined customer base, and inter-company revenue elimination.
• The acquisition is expected to decrease FY17 non-GAAP diluted EPS by approximately $0.07. This estimate reflects standard integration costs and transaction fees expected to be in the range of $30 mln.
• Q2 FY17 Revenue: The acquisition is expected to increase Salesforce's Q2 FY17 total revenue by approximately $0 mln to $10 mln. Q2 FY17 non-GAAP EPS: Transaction fees related to the acquisition are expected to reduce Q2 FY17 diluted non-GAAP EPS by approximately $0.03.
• Based on the above, Salesforce is updating its guidance previously reported on May 18, 2016, as follows:
  • Q2 FY17 Guidance: Revenue for Salesforce's fiscal second quarter 2017 is projected to be in the range of $2.005 bln to $2.025 bln, an increase of 23% to 24% year-over-year.

March IPO calendar : 8 IPOs were priced

March is poised to have its busiest month since 2007 as eight companies set terms this week. There are 13 deals on the IPO calendar for the next two weeks. If all are completed, March could have 19 IPOs, topping the 17 IPOs completed in March of 2007.

BATS Global Markets, which operates the third largest securities exchange in the US, announced terms for its IPO on Monday. The Lenexa, KS-based company plans to raise $107 million by offering 6.3 million shares (100% insider) at a price range of $16.00 to $18.00. At the midpoint of the proposed range, BATS Global Markets would command a market value of $817 million. BATS Global Markets, which was founded in 2005 and booked $927 million in sales in 2011, plans to list on one of its own exchanges, the BZX, under the symbol BATS. Morgan Stanley, Citi and Credit Suisse are the lead underwriters on the deal.

Regional Management Corp., which provides an array of loan products to customers with limited access to traditional lenders, announced terms for its IPO on Monday. The Greenville, SC-based company plans to raise $76 million by offering 4.2 million shares (33% insider) at a price range of $17.00 to $19.00. At the midpoint of the proposed range, Regional Management would command a market value of $226 million. Regional Management, which was founded in 1987 and booked $105 million in sales in 2011, plans to list on the NYSE under the symbol RM. Jefferies, Stephens, JMP Securities, and BMO Capital Markets are the lead underwriters on the deal.

Enphase Energy, which delivers a semiconductor-based system that increases solar energy production, announced terms for its IPO on Monday. The Petaluma, CA-based company plans to raise $80 million by offering 7.3 million shares at a price range of $10.00 to $12.00. At the midpoint of the proposed range, Enphase Energy will command a fully diluted market value of $435 million. Since inception, Enphase has raised over $115 million in venture capital to help develop its unique, chip-based microinverter system, which includes a communications gateway and web-based software to monitor system performance. Backers include Third Point Ventures (the venture arm of Daniel Loeb's Third Point hedge fund), RockPort Capital, Madrone Partners (affiliated with the Walton family), Kleiner Perkins Caufield & Byers (KPCB), Applied Ventures and Bay Ventures, who will collectively own over 60% of the company following the IPO.

Enphase Energy, which was founded in 2006 by semiconductor and telecom equipment alums, booked $150 million in sales in 2011. The company plans to list on the NASDAQ under the symbol ENPH. Morgan Stanley, BofA Merrill Lynch and Deutsche Bank Securities are joint-bookrunning managers on the deal. Jefferies, Lazard and ThinkEquity are serving as co-managers.

Vocera Communications, which provides mobile communication solutions for hospitals and health care facilities, announced terms for its IPO on Tuesday. The San Jose, CA-based company plans to raise $75 million by offering 5.8 million shares (13% insider) at a price range of $12.00 to $14.00. At the midpoint of the proposed range, Vocera Communications would command a market value of $320 million. Vocera Communications, which was founded in 2000 and booked $80 million in sales in 2011, plans to list on the NYSE under the symbol VCRA. J.P. Morgan and Piper Jaffray are the joint bookrunners on the deal.

CafePress, which operates an e-commerce site where customers create, buy and sell personalized products, announced terms for its IPO on Wednesday. The San Mateo, CA-based company plans to raise $77 million by offering 4.5 million shares (44% insider) at a price range of $16.00 to $18.00. At the midpoint of the proposed range, CafePress would command a market value of $303 million. Venture capital firm Sequoia Capital is not selling and will own 17% of shares after the offering.

CafePress, which was founded in 1999 and booked $175 million in 2011 sales, plans to list on the NASDAQ under the symbol CPRS. J.P. Morgan and Jefferies are the joint bookrunners on the deal.

Millennial Media, which operates the leading independent mobile advertising platform, announced terms for its IPO on Thursday. The Baltimore, MD-based company plans to raise $102 million by offering 10.2 million shares (10% insider) at a price range of $9.00 to $11.00. At the midpoint of the proposed range, Millennial Media would command a market value of $818 million. Venture backers include Bessemer Venture Partners (18% post-IPO stake), Columbia Capital (18%), Charles River Ventures (14%) and New Enterprise Associates (15%); none are selling on the IPO.

Millennial Media, which was founded in 2006, booked $104 million in sales last year, more than double the $47 million booked in 2010. The company plans to list on the NYSE under the symbol MM. Morgan Stanley, Goldman, Sachs & Co. and Barclays Capital are the bookrunners on the deal.

Luca Technologies, which uses biotechnology to create and sustainably produce natural gas, announced terms for its IPO on Thursday. The Golden, CO-based company plans to raise $102 million by offering 8.5 million shares at a price range of $11.00 to $13.00. At the midpoint of the proposed range, Luca Technologies would command a market value of $352 million. Revenue in 2011 was $1 million, down 56% from 2010 and down 80% from 2008. Luca Technologies, which was founded in 2003, plans to list on the NASDAQ under the symbol LUCA. Citi, Piper Jaffray and Raymond James are the joint bookrunners on the deal.

Annie's, which is a leading organic food company that offers over 125 products, including a signature macaroni and cheese, announced terms for its IPO on Friday. The Berkeley, CA-based company plans to raise $75 million by offering 5 million shares (79% insider) at a price range of $14.00 to $16.00. At the midpoint of the proposed range, Annie's would command a market value of $263 million. Annie's, which was founded in 1989 and booked $135 million in sales in 2011, plans to list on the NYSE under the symbol BNNY. Credit Suisse and J.P. Morgan are the joint bookrunners on the deal.

The 6 IPOs that have been priced this month are all trading above their offer prices. Demandware is the best performer of this group, closing up 48% in its first day of trading yesterday. Yelp trails closely, posting a 45% return since its March 2nd debut. The IPO market has shown strong returns so far this year. The FTSE Renaissance US IPO Index is up 19% year-to-date.

Demandware files for a $100 mln IPO

(Reuters) - Demandware Inc, which provides cloud-based e-commerce products, filed with U.S. regulators on Friday to raise up to a $100 million in an initial public offering of its common shares.

• The Burlington company posted its first profit in five years in 2010. 
• Backed by venture capital firms North Bridge and General Catalyst Partners, it had 75 customers as of March 31, 2011.

In a filing with the U.S. Securities and Exchange Commission, the company said Goldman Sachs & co, Deutsche Bank Securities, William Blair & Company, Oppenheimer & Co, Canaccord Genuity and First Analysis Securities Corp would underwrite the IPO.

Burlington, Massachusetts-based Demandware was founded by Stephan Schambach in 2004, and posted its first profit in five years in 2010.

Demandware, which is backed by venture capital firms North Bridge and General Catalyst Partners, had 75 customers as of March 31, 2011.

The company plans to list its shares on the New York Stock Exchange under the symbol DWRE.

The filing did not reveal the number of shares the company planned to sell or their expected price.