Pathwire, a courier company that was once owned by Rackspace, is acquired by Swedish company Sinch AB in a $ 1.9 billion cash and stock transaction.
It could to be one of the largest deals in the local tech industry since 2016, when Apollo Global Management bought Rackspace for $ 4.3 billion.
Sinch, a global cloud communications company, is set to pay Sellers, a group that includes Chicago-based private equity firm Thoma Bravo, $ 925 million in cash and 51 million new shares in Sinch.
The deal, announced last week, is expected to be concluded by the end of the year, pending approval from the Federal Trade Commission and the Department of Justice. Pathwire will merge with Sinch’s US subsidiary, Pegasus Corp. One.
Pathwire provides an email platform for marketing communications and “transactional emails”, which are automated emails such as booking confirmations, receipts and password resets. Those transaction emails make up most of the value of the growing $ 16 billion global market, according to a study by Technavio, a market research group cited by Sinch.
Pathwire is expected to generate total revenue of $ 132 million for 2021, with gross profit of $ 104 million, according to a press release from Sinch. It employs around 290 people and is based at the Weston Center on East Pecan Street.
“Sinch and Pathwire naturally fit together,” Pathwire CEO Will Conway said in a prepared statement. “I’m proud of what the Pathwire team has accomplished, and I’m extremely excited about this next step in our journey and the many opportunities we can unlock together. “
Pathwire has more than 100,000 customers, including Lyft and Microsoft, the statement said. Its three main product groups – Mailgun, Mailjet and Email on Acid – aim to help developers and marketers build messaging systems that reach targeted inboxes with personalized views.
“Each form of digital communication has its unique advantages, and delivering high quality at scale requires both extensive technical capabilities and in-depth subject matter expertise,” Sinch CEO Oscar Werner said in a prepared statement. “Together with Pathwire, we will be able to offer a cutting edge product suite, across messaging, voice and email. “
Pathwire was founded in 2010 as Mailgun Technologies, a name it was known by until February of this year. Rackspace bought the business in 2012 and owned it for five years until Conway separated from the business. The company continued to grow with the help of private equity funds from groups such as Scaleworks, based in San Antonio, Turn / River Capital, based in San Francisco, and Thoma Bravo.
Sinch, based in Stockholm, has offices in more than 30 countries.