Just a few weeks ago, investors griped about the price a private equity firm offered to buy Instructure, a Salt Lake City-based learning management system provider best known for its Canvas product, which is widely used in the U.S. higher education market.
Now that U.S. markets have recorded their worst week since the 2008 financial crisis, $49 a share to take the publicly traded edtech company private doesn’t seem so bad.
“We do not believe the deal would have successfully gone through pre-COVID-19,” according to a report from investment bank D.A. Davidson on Monday. The bank estimates a multiple of about 6.6 times Instructure’s revenue over the next twelve months.
Instructure and Thoma Bravo said that the deal should close Tuesday following the private equity firm’s purchase of enough shares to get at least 64.4 percent of aggregate voting power in the company, according to a statement Monday. The stock traded at about $49 at market opening Monday.