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The Microsoft store in Midtown Manhattan, New York City, in 2018 Drew Angerer/Getty Images
The Microsoft store in Midtown Manhattan, New York City, in 2018

Microsoft’s Reseller SoftwareONE Plans Swiss IPO

Microsoft's largest license reseller helps companies manage their software portfolios and partners with the likes of AWS, IBM, and Adobe.

Leonard Kehnscherper (Bloomberg) -- Swiss technology firm SoftwareONE AG plans an initial public offering aimed at raising its profile and giving it access to capital markets.

The deal is planned for the fourth quarter subject to market sentiment, the company said Monday. The share sale will consist entirely of secondary shares and the founding shareholders will keep the largest stake. Investor KKR & Co., which holds 25%, “intends to retain a significant interest following the IPO,” it said.

Unfavorable markets and economic uncertainty have dented investor sentiment, hitting companies like WeWork, Peloton, Endeavor, TeamViewer and others. In Switzerland, the performance of the two bigger IPOs this year has been mixed with shares in joint-replacement maker Medacta Group SA trading 16% below issue price since a listing in April. Stadler Rail AG gained 19% in the almost six months since its trading debut.

Stans, Switzerland-based SoftwareONE helps companies managing their software portfolio, while partnering with providers and publishers like Amazon Web Services Inc., Adobe Inc., IBM Corp.. SoftwareONE is the largest license reseller of U.S. software giant Microsoft Corp.

While the company has not yet set pricing for the offering, it will be compared in marketing to a peer group including EPAM Systems Inc and Softcat Plc that trades at about 21 times enterprise value to Ebitda, according to a person familiar with the matter. Based on SoftwareONE’s pro-forma adjusted Ebitda of 187 million francs for 2018, the company’s enterprise value would work out to as much as 4 billion francs on that basis.

SoftwareONE’s Chief Financial Officer Hans Grueter declined to comment on the enterprise value at a press conference in Zurich. The dividend payout ratio is expected to be at around 30% or higher, Chairman Daniel von Stockar said in an interview with Swiss news agency AWP.

SoftwareONE currently employs over 5,300 employees in 90 countries. Listed competitors include the U.K.’s Softcat Plc and Germany’s Bechtle AG and Cancom SE. Earlier this year, SoftwareONE acquired Leipzig, Germany-based competitor Comparex with 2,450 employees and annual revenue of about 2.5 billion euros ($2.7 billion).

The planned listing will be handled by Credit Suisse, JPMorgan and UBS as joint global coordinators and joint bookrunners. BNP Paribas, Citi, Deutsche Bank, UniCredit and Zuercher Kantonalbank are acting as joint bookrunners, while Rothschild & Co is SoftwareONE’s financial adviser.

TAGS: Microsoft
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