Quest enter into agreement with Insight Ventures

Quest Software, Inc. (Aliso Viejo, CA., USA) have announced that it had entered into definitive agreements with affiliates of Insight Venture Partners (New York, NY, USA), under which stockholders not affiliated with the buyout group would receive $23.00 per share in cash, valuing the Company at approximately $2.0 billion. The shares of Chairman and CEO Vinny Smith, who will continue to lead the Company after the closing of the proposed transaction, will be “rolled over” into the surviving privately owned entity. The purchase price represents a 19-percent premium to the closing price on March 8, 2012.

H. John Dirks, Chairman of the Special Committee stated, “We are pleased to have successfully negotiated a transaction that includes an attractive upfront premium for Quest’s shareholders, an all-cash deal that would eliminate ongoing execution risk following a transaction, and that compares favorably with Quest’s standalone alternatives. In addition, the transaction agreements include a robust ‘go-shop’ provision and a low termination fee structure. The Special Committee pursued this option after a review with their advisors of the Company’s strategic alternatives, and the Special Committee and the Board recommend that the Company’s stockholders vote in favor of the proposed transaction.”

The proposed merger with an affiliate of Insight was negotiated and unanimously recommended to the Board by a Special Committee of the Company’s Board of Directors, which comprised three independent and disinterested directors. The Special Committee was advised by independent financial and legal advisors. The entire Board, with the exception of Vinny Smith who recused himself from the vote, voted in favor of the proposed transaction.

Vinny Smith, CEO, Quest Software

“As a private company, we will have increased flexibility to drive innovation across our product lines and execute our long-term strategy. We expect this strategic partnership with Insight, with whom we have worked for many years, will ensure the Company has a secure foundation and a commitment to investment in the Company’s long-term growth,” said Vinny Smith. “This move to a private company also will create exciting career opportunities for our employees, while retaining our commitment to continuing to provide excellent service to our customers.”

Upon closing, Quest expects to become a privately held company and will continue to be led by Vinny Smith and the existing senior management team. The Company plans to maintain its headquarters in California.

Michael Triplett, Managing Director at Insight

“Insight has known Vinny Smith for many years and is pleased to support him and management as they seek the stability and long-term focus required for the Company to achieve its potential,” said Michael Triplett, Managing Director at Insight. “We believe that our track record of success working with leading infrastructure management software companies enables us to be strong partners to management while they increase value to all stakeholders in the Company, including employees and customers.”

Source: Quest Software