Clearlake Capital Group to Acquire Dun & Bradstreet for $7.7 Billion

Good morning. Welcome to The Deal Talk where each week we break down a recent M&A deal.

Today we’re going to dive into Clearlake’s $7.7B acquisition of Dun & Bradstreet for $7.7 billion.

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DEEP DIVE
Clearlake Capital Group to Acquire Dun & Bradstreet for $7.7 Billion

Clearlake Capital Group, a prominent private equity firm based in Santa Monica with $90B AUM, has signed a definitive agreement to acquire Dun & Bradstreet Holdings, Inc., a leading global provider of business decisioning data and analytics, in a transaction valued at approximately $7.7B, including outstanding debt.

Under the terms of the agreement, Dun & Bradstreet shareholders will receive $9.15 in cash per share, reflecting a premium over the company's last closing price. The acquisition is expected to close in the third quarter of 2025.

Strategic Rationale

This acquisition aligns with Clearlake’s strategy to invest in established companies with strong growth potential. Over the past six years, Dun & Bradstreet has undergone significant transformation, leading to a 40% increase in revenue and a 60% rise in EBITDA. DNB works on a subscription model, which shows signs of stable cash flow, and recurring revenue, good signs for a PE investor. However, DNB’s stock price is down ⅔ from its peak, which appeals to Clearlake as a value investor. 

Clearlake’s investment thesis revolves around:

• Enhancing Dun & Bradstreet’s market position as a global leader in business data analytics.

• Capitalizing on increasing demand for data-driven decision-making across industries.

• Utilizing Clearlake’s operational expertise to drive innovation and expand global reach.

Financial Impact & Valuation Premium

The acquisition values Dun & Bradstreet at $7.7 billion, including debt, with an equity value of $4.1 billion.

• Per-Share Purchase Price: $9.15 per share in cash

• Premium: 4.8% over the last closing price

• Leverage down from 9x to 3.6x

This valuation underscores Clearlake’s confidence in Dun & Bradstreet’s future earnings potential, as businesses continue to increase reliance on data analytics for decision-making.

Deal Structure & Financial Advisors

Transaction Details

• Transaction Type: 100% acquisition of Dun & Bradstreet, DNB will be private after the deal

• Financing: Combination of equity (25%) and debt financing (5.75B, or 75%)

• 30-day go-shop period for Dun & Bradstreet

• Termination fee of $123M

Financial Advisors & Legal Counsel

• Dun & Bradstreet: BofA Securities

• Clearlake Capital Group: Morgan Stanley, Goldman Sachs, J.P. Morgan, Rothschild & Co., Barclays, Citi, Deutsche Bank, Santander, Wells Fargo

• Financing Participants for Clearlake: Ares Credit Funds, HSBC

• Legal Counsel: Sidley Austin LLP (Clearlake), Weil, Gotshal & Manges LLP (Dun & Bradstreet)

Opinion & Outlook

What Could Go Right?

• Operational Enhancements: Clearlake’s expertise in driving operational efficiencies could further strengthen Dun & Bradstreet’s performance.

• Market Demand: With increasing reliance on business data analytics, the company is well-positioned for sustained growth in the long run.

What Could Go Wrong?

• Integration Challenges: Aligning Dun & Bradstreet’s operations with Clearlake’s vision may pose challenges especially with the shortcuts private equity can take to make a company more “efficient”.

• Market Competition: The data analytics sector is highly competitive, requiring continuous investment in innovation, DNB failing to meet its 2024 Q4 earnings could be a sign of a shaky future ahead. DNB shares are down 30% this year, and there is a 1.8% revenue decline in North America.

Conclusion

Clearlake Capital Group’s acquisition of Dun & Bradstreet highlights the growing value of data-driven decision-making in today’s business environment. This deal not only enhances Clearlake’s investment portfolio but also positions Dun & Bradstreet for accelerated growth and market expansion.

This transaction underscores the increasing importance of business intelligence solutions, potentially paving the way for further industry consolidation and innovation.

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The Deal Talk Team