Nitro Software to raise $140 million for Connective acquisition

Nitro Software to raise $140 million for Connective acquisition

Nitro Software co-founder and CEO Sam Chandler. 

Australian document productivity software group Nitro Software (ASX: NTO) has today announced it will raise $140 million in order to buy a Belgium-based eSign software as a service (SaaS) business called Connective NV.

Melbourne-headquartered Nitro says the acquisition, which implies an enterprise value of $110 million, will cement its position as a global SaaS player, giving it access to fast-growing European markets.

“This is a milestone moment in Nitro’s growth story. With the acquisition of Connective, Nitro is well placed to become the third global player in the fast-growing enterprise eSign market,” San Francisco-based Nitro co-founder and CEO Sam Chandler said.

“Connective adds highly secure, enterprise-grade eSigning, eID and workflow capabilities to Nitro’s existing eSign solutions at a time where increased trust, security, and regulatory compliance are vital to business success. With data security at a premium, the future of eSigning is built around high-trust eID-driven solutions, and this acquisition positions Nitro to become a global leader.

“Connective’s Smart Document product will further bolster Nitro’s platform, making document workflow automation easy, powerful and available to all. There are a multitude of opportunities to add Connective’s market-leading products to Nitro’s platform and drive additional demand through our global sales network and 12,000+ business customers.”

Founded in 2014, Connective serves more than 1,000 customers across Europe in a diverse range of industries including financial institutions, multinationals and governments. Some major customers are the Belgian and French governments, BNP Paribas, Adecco, Societe Generale, Pirelli and Toyota.

“We are delighted to have found a partner in Nitro that so closely aligns with our mission and vision, as well as our core company values,” Connective CEO Nicholas Metivier said.

“There was an immediate connection with Sam and the Nitro team, and it was clear to me how Connective’s market leading solutions could scale even further as part of the Nitro Productivity Platform.

“Our market-leading eSign and eID solutions have helped us establish a formidable presence in Europe and with Nitro’s customer base and global reach, we are excited to expand this presence around the world.”

The acquisition will be funded by a $140 million fully underwritten equity raising, with the extra funds to be used across the company to assist with acquisition integration and transaction-related expenses, as well as for company liquidity and working capital.

The raise will be conducted at $3.43 per new share, which implies a 10.7 per cent discount to the last closing price of $3.84 per share on 9 November 2021.

The acquisition comes nearly two years after Nitro debuted on the ASX with a market capitalisation of $324.9 million. That has since more than doubled, and as of yesterday NTO had a market cap of $765.5 million.

Founded in Melbourne in 2005 the company initially sought to offer an alternative solution to Adobe Acrobat called Nitro Pro.

Since then the company has expanded to specialise in document productivity, digital transformation and change management.

NTO remains in a trading halt pending the outcome of the institutional component of its entitlement offer and is expected to resume trading tomorrow.

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