EQT snaps up API and id administration software program firm WSO2 for greater than $600M

WSO2, an organization that gives API administration and id and entry administration (IAM) providers for enterprises, has been acquired by Swedish funding large EQT.

Phrases of the deal weren’t disclosed, however TechCrunch has discovered by way of sources that the deal values WSO2 at “greater than” $600 million, with EQT attaining a “important majority” stake for the worth.

WSO2’s merchandise embody an open-source API manager, corresponding to one thing like Google’s Apigee, which companies use for constructing and integrating all their digital providers, both within the cloud or on-premises. The corporate gives tangential providers corresponding to API administration particularly for Kubernetes, in addition to its flagship Identity Server — a bit one thing like Okta — that corporations use for managing id and entry performance of their apps, corresponding to single sign-on (SSO).

WSO2, which was based out of Sri Lanka in 2005, had raised round $130 million in funding from the likes of Intel, Cisco and Goldman Sachs, with its most up-to-date tranche coming via a $93 million Series E round in 2022. An official valuation was by no means introduced, however articles from some shops on the time reported a valuation of greater than $600 million. So that may imply WSO2 has remained considerably stagnant, although the “greater than” aspect right here may disguise some motion within the firm’s valuation.

A robust observe document

WSO2 co-founder and CEO Sanjiva Weerawarana has a robust tack document within the open-source sphere, significantly amongst Apache Software program Basis tasks, and he was one of many predominant designers of the cloud-native Ballerina programming language. Since 2017, Weerawarana additionally drives for Uber, which he says is designed to “problem the norm” and make IT extra socially acceptable in his native Sri Lanka.

WSO2 is a reasonably well-distributed firm, consistent with the ethos of different companies based round open supply. Whereas the corporate counts a U.S. HQ in Santa Clara, and lots of of its senior management crew are unfold throughout the U.S., its heart of gravity lies in Sri Lanka the place a lot of its workforce is predicated — together with Weerawarana, who’s based mostly within the capital Colombo.

With that in thoughts, IT’s price noting that the acquisition was truly made by an EQT subsidiary known as EQT Personal Capital Asia, previously referred to as Baring Personal Fairness Asia, which EQT procured in 2022 for €6.8 billion to function its non-public fairness automobile for Asia.

With a world unfold of consumers that embody AT&T, Honda and Axa, that is one thing that EQT Personal Capital Asia accomplice Hari Gopalakrishnan says was a key a part of its determination to speculate. Furthermore, with cloud computing and AI driving demand for safety infrastructure, WSO2 was a very interesting proposition for an funding agency with latest kind within the enterprise software program house.

“Software program is a key focus sector for EQT, and WSO2 is a robust firm that has scaled globally with an enterprise buyer base unfold throughout the US and Europe,” Gopalakrishnan mentioned in a statement. “[We] imagine that the corporate is well-positioned to capitalize on long-term traits corresponding to digital transformation and rising GenAI adoption.”

EQT say that IT expects the acquisition to shut within the second half of 2024.

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