Form 4: Zuora Inc. Completes Merger with Zodiac Purchaser, Silver Lake Affiliates Repurchase and Contribute Convertible Notes

Silver Lake Group affiliates repurchase and contribute Zuora's convertible notes as part of the merger with Zodiac Purchaser, making Zuora a wholly-owned subsidiary.

Summary

• Zuora Inc. has completed its merger with Zodiac Purchaser, L.L.C., an affiliate of Silver Lake Group, L.L.C.
• As part of the merger, Zuora has become a wholly-owned subsidiary of Parent.
• Immediately prior to the merger, Zuora repurchased $103,066,757 of its 3.95%/5.50% Convertible Senior PIK Toggle Notes due 2029 from SLA II CM for $130,000,000.
• SLA II CM also contributed $296,933,243 aggregate principal amount of the Convertible Notes to an indirect parent company of Parent.
• These contributed notes will be further contributed down to Zuora to be cancelled.

Sentiment

Score: 7

Explanation: The document describes the completion of a merger, which is generally a positive event for shareholders receiving a premium. The restructuring of debt is also a positive sign.

Positives

• The merger provides Zuora with new ownership under Silver Lake Group.
• The repurchase and cancellation of convertible notes simplifies Zuora's capital structure.

Future Outlook

The document does not contain specific forward-looking statements beyond the completion of the merger and related transactions.

Industry Context

This announcement reflects a trend of private equity firms acquiring publicly traded companies, particularly in the technology sector. Silver Lake's acquisition of Zuora is consistent with their investment strategy of focusing on technology companies.

Comparison to Industry Standards

• Private equity acquisitions in the SaaS space often involve restructuring of debt and equity.
• The repurchase of convertible notes is a common tactic to streamline the balance sheet after an acquisition.
• Silver Lake's involvement is comparable to other large private equity firms like Thoma Bravo or Vista Equity Partners acquiring and managing software companies.

Related Party Transactions

• The repurchase of Convertible Notes from SLA II CM, an affiliate of Silver Lake Group, is a related party transaction.
• The contribution of Convertible Notes to an indirect parent company of Parent is a related party transaction.

Stakeholder Impact

• Shareholders of Zuora have been impacted by the merger.
• Employees of Zuora will now be part of a company owned by Silver Lake Group.
• Customers and suppliers may experience changes as a result of the acquisition.

Key Dates