Datto Holding (MSP) priced 22 mln share IPO at $27.00 per share, at the top end of the expected range of $24-27
Datto Holding, a backup-software company backed by Vista Equity Partners, priced at the high end of its initial public offering range, collecting roughly $550 million.
Late Tuesday, Datto sold 22 million shares at $27 each, the top of its $24 to $27 price range. Datto started trading Wednesday on the New York Stock Exchange under the symbol MSP.
Morgan Stanley, BofA Securities, Barclays and Credit Suisse are underwriters on the deal.
Datto is the latest software company to go public. Both Asana(Ticker: ASAN), which offers cloud-based project-management software, and Snowflake(SNOW), a cloud software company, made their debuts in late September. McAfee, the cybersecurity company, is expected to price its offering Wednesday night and begin trading on Thursday.
Founded in 2007, Datto provides business-continuity software, including backup and disaster recovery, that helps companies secure their data. Datto’s software is delivered through a managed-service-provider, or MSP, channel to small and medium-size businesses. The company had 17,000 MSP partners as of June 30, according to its prospectus. Datto said it helped restore more than 200 million software as a service objects in 2020, the prospectus said.
The company reported $10.1 million in profit for the six months ended June 30 on $249.1 million in revenue. This compares with $25.7 million in losses a year earlier on $215 million in revenue. Long-term debt stood at $577 million as of June 30. It has 1,653 employees as of June 30.
With 157,548,740 shares outstanding, Datto has a roughly $4.3 billion market cap, at $27 a share.
Vista Equity Partners acquired Datto in 2017 for $1.3 billion and merged the company with Autotask. Vista will own 70.7% of Datto after the IPO, while Austin McChord, Datto’s founder, will have 13%.
The Datto IPO comes just days since Robert Smith, Vista’s CEO, reached a $140 million settlement with the Justice Department, the Wall Street Journal reported. The nonprosecution agreement ends a yearslong U.S. tax investigation and calls for Smith to admit tax fraud as well as not properly filing foreign bank account reports, according to the Journal. Brian Sheth, Vista’s president and co-founder, is now looking to leave the firm, according to media reports.
