Apax to take IT consultancy Thoughtworks private in $1.75 billion deal

Apax Partners, a London-based private equity firm, has agreed to take private Thoughtworks, a Chicago-based technology consulting firm.

The transaction, which is slated to close in the fourth quarter of 2024, arrives approximately three years after Thoughtworks went public.

The firm has gone through a turbulent financial patch, with its stock losing 87% of its value since January 2022. Thoughtworks’ current restructuring plans include a cost reduction effort which will shave approximately 7% of its 10,500-person headcount.

The consultancy’s second quarter results marked a 12.4% drop in revenue compared to the year prior, at $251.7 million.

Apax has agreed to purchase all outstanding shares of Thoughtworks common stock that it does not already own for $4.40 per share, a 30% premium over the closing price on August 2, 2024.

“Apax has been a longstanding strategic partner for Thoughtworks,” said Mike Sutcliff, CEO of Thoughtworks. “With their continued support, we plan to make the necessary long-term investments and advance our vision of being a stronger, strategic partner for our clients.”

Rohan Haldea, partner at Apax and non-executive director of Thoughtworks, added, “We believe that it is in the interest of all stakeholders for the Company to return to private ownership to allow the organization to re-focus on growth.”

Thoughtworks was founded in 1993 and has 48 offices in 19 countries. The firm works with clients in a wide range of industries on areas including software engineering, IT modernization, customer experience, cloud, data, and AI.

“For 30 years, Thoughtworks has created an extraordinary impact on the world through its culture and technology excellence. We look forward to continuing our partnership with the company in its next chapter of growth,” said Salim Nathoo, partner at Apax and non-executive director of Thoughtworks.

Lazard acted as financial advisor to Thoughtworks on the transaction.