8-K: OneStream to Go Private in $6.4B Hg-Led Acquisition

OneStream, a leading enterprise Finance management platform, will be acquired by Hg for $6.4 billion in an all-cash transaction, offering shareholders a 31% premium.

Summary

• OneStream, Inc. will be acquired by entities affiliated with Hg in an all-cash transaction valued at approximately $6.4 billion in equity.
• Shareholders will receive $24.00 per share for Class A and Class D common stock, representing a 31% premium over the January 5, 2026 closing price and a 27% premium over the 30-trading day volume-weighted average share price.
• Hg will become the majority voting shareholder, with General Atlantic and Tidemark as significant minority investors.
• The transaction was unanimously approved by OneStream's Board of Directors and by KKR, which holds a majority of OneStream's voting power, meaning no further stockholder approval is required.
• The acquisition is expected to close in the first half of 2026, subject to customary closing conditions, including regulatory approvals.
• OneStream's Tax Receivable Agreement (TRA) will terminate upon the merger, with no payments made under it in connection with the merger.
• CEO Tom Shea and the current leadership team will remain in place, and OneStream's headquarters will stay in Birmingham, Michigan.

Sentiment

Score: 9

Explanation: The acquisition at a significant premium provides immediate and certain value to shareholders. The strategic partnership with Hg, General Atlantic, and Tidemark is expected to accelerate OneStream's AI innovation and market position, indicating strong future prospects under private ownership, despite the loss of public trading.

Positives

• Shareholders receive a significant cash premium of 31% over the previous day's closing price and 27% over the 30-day volume-weighted average share price.
• The all-cash nature of the transaction provides immediate and certain value to OneStream shareholders.
• The partnership with Hg, General Atlantic, and Tidemark is expected to accelerate OneStream's AI innovation and expand its Finance AI capabilities.
• OneStream's CEO and current leadership team will remain, ensuring continuity in strategy and operations.
• The acquisition is not subject to any financing contingency, providing greater certainty of closing.

Negatives

• OneStream will become a privately held company, meaning its Class A common stock will no longer be publicly traded on Nasdaq.
• The Tax Receivable Agreement (TRA) will terminate upon the merger, and no payments will be made under it in connection with the merger, which could be a negative for certain TRA beneficiaries.
• Potential for disruption to OneStream's current plans, operations, and business relationships, including loss of customers and employees, is identified as a risk.
• OneStream will incur costs, fees, expenses, and other charges related to the transaction.

Risks

• The possibility that the conditions to the closing of the transaction are not satisfied, including the risk that required regulatory approvals are not obtained on a timely basis or at all.
• The occurrence of any event, change, or circumstance that could give rise to a right to terminate the transaction, including in circumstances requiring OneStream to pay a termination fee of $207,000,000 to Hg.
• Possible disruption related to the transaction to OneStream's current plans, operations, and business relationships, including through the loss of customers and employees.
• The amount of the costs, fees, expenses, and other charges incurred by OneStream related to the transaction.
• The risk that OneStream's stock price may fluctuate during the pendency of the transaction and may decline if the transaction is not completed.
• The diversion of OneStream management's time and attention from ongoing business operations and opportunities.
• The response of competitors and other market participants to the transaction.
• Potential litigation relating to the transaction.
• Uncertainty as to the timing of completion of the transaction and the ability of each party to consummate the transaction.

Future Outlook

OneStream expects to significantly advance its AI-first go-to-market strategy and expand its Finance AI capabilities at a rapid pace through this partnership. The company aims to move faster, think bigger, and deliver more for its forward-thinking Finance customers, building on its vision to be the operating system for modern Finance.

Management Comments

• "Today marks a pivotal moment for OneStream and our vision to be the operating system for modern Finance." Tom Shea, CEO of OneStream.
• "The Office of the CFO is at a critical AI inflection point, and we believe OneStream is well positioned for this shift." Tom Shea, CEO of OneStream.
• "Through this partnership, we are able to significantly advance our AI-first go-to-market strategy and expand our Finance AI capabilities at a rapid pace." Tom Shea, CEO of OneStream.
• "This transaction delivers immediate value to our shareholders and is a vote of confidence in our strategy, our talented employees and our partner ecosystem." Tom Shea, CEO of OneStream.
• "We look forward to having the ability to move faster, think bigger and deliver more for our forward-thinking Finance customers." Tom Shea, CEO of OneStream.
• "With over $4.5 billion invested in providers that serve the Office of the CFO to date, we understand the tremendous opportunity for OneStream, as technology and industry trends continue to place increasing demands on Finance teams." Alan Cline, Partner and Head of North America at Hg.
• "OneStream's powerful AI differentiation, strong global customer base and clear vision for the future of modern Finance make it a leading enterprise provider in this space and exceptionally well positioned for the future." Alan Cline, Partner and Head of North America at Hg.
• "We will seek to preserve the strong customer focus and entrepreneurial culture that have been central to their success, while bringing Hgs deep expertise in scaling software businesses." Joe Jefferies, Partner at Hg.
• "OneStream is reimagining enterprise Finance with an AI-focused, multi-product platform that provides immense value to the Office of the CFO." Jimmy Miele, Managing Director at General Atlantic.
• "We are incredibly proud of what the OneStream team has been able to achieve over the course of our strategic partnership and the role that it has been able to establish as a trusted partner to global enterprises." Dave Welsh, Partner at KKR and Head of TMT Growth Equity.

Industry Context

The acquisition highlights the increasing demand for advanced financial technology solutions, particularly those leveraging AI, within the Office of the CFO. Hg's extensive investment in this sector ($4.5 billion to date) underscores a broader industry trend towards modernizing finance functions through unified, AI-driven platforms. OneStream's position as a 'leading enterprise Finance platform' and 'operating system for modern Finance' reflects the strategic importance of comprehensive solutions in a rapidly evolving technological landscape.

Comparison to Industry Standards

• Hg's 'deep expertise in scaling software businesses' is a key resource for OneStream's growth, aligning with industry best practices for private equity-backed software companies.
• Hg's 'AI team of over 100 specialists and supporting partnerships' and 'Hg Catalyst, our dedicated AI incubator' represent specialized resources that exceed typical company capabilities, brought to bear by a leading investment firm to accelerate product innovation.
• The acquisition by a leading software investor like Hg, with co-investments from General Atlantic and Tidemark, aligns with a trend of private equity firms acquiring established software companies to accelerate growth and innovation outside public market pressures.

Management Changes

Corporate Governance

Legal Proceedings

• "Potential litigation relating to the transaction" is identified as a risk in forward-looking statements.
• The filing mentions 'Transaction Litigation' (any legal proceeding related to the mergers) and outlines cooperation requirements between parties for defense, settlement, or prosecution.

Related Party Transactions

• Certain stockholders affiliated with Kohlberg Kravis Roberts & Co. L.P. (KKR), holding approximately 58% of OneStream's voting power, entered into a support agreement to vote their shares in favor of the merger.
• KKR-affiliated OneStream LLC members entered into an amendment to the Tax Receivable Agreement, terminating it upon merger consummation without further payments.
• Thomas Shea, OneStream's Chief Executive Officer and a member of the Board, agreed to roll over a portion of his equity holdings in connection with the consummation of the Mergers.

Stakeholder Impact

• Shareholders will receive $24.00 per share in cash, a significant premium, providing immediate liquidity and value realization.
• Continuing employees will have their employment continued and will receive compensation and benefits no less favorable in aggregate for one year post-merger. Service credit will be recognized for eligibility, vesting, and benefits in new plans.
• Customers are expected to benefit from accelerated AI innovation and expanded Finance AI capabilities due to the strategic partnership and investment.
• KKR, as a significant investor, realizes its investment in OneStream, which it took public in 2024, and approves the transaction.
• Hg, General Atlantic, and Tidemark, as new investors, gain majority and significant minority ownership, respectively, with a strategic focus on accelerating OneStream's growth and AI capabilities.

Next Steps

• Completion of customary closing conditions, including regulatory approvals.
• Closing of the transaction, expected in the first half of 2026, but not before April 6, 2026, without Parent's consent.
• OneStream's Class A common stock will be delisted from Nasdaq and deregistered pursuant to the Exchange Act after the merger.
• OneStream plans to release its fourth quarter and fiscal year 2025 results in February 2026.
• The Company Parties will cooperate with Buyer Parties to provide notice of the transaction to the FedRAMP Program Management Office and relevant Authorizing Officials.

Key Dates

Recommendation

The acquisition offers a substantial 31% premium over the previous day's closing price, providing immediate and certain cash value to shareholders. With the Board's unanimous approval and KKR's majority voting power already secured, the likelihood of the transaction closing is high, making it an attractive opportunity for investors to capture the premium if the current market price is below the $24.00 offer.

Keywords

OneStream, OS, Acquisition, Merger, Hg, General Atlantic, Tidemark, KKR, Private Equity, Software, Finance Management, CFO, AI, Financial Technology, Delisting, Privatization, Shareholder Premium