SolarWinds Corp., a publicly traded software company controlled by Silver Lake Management and Thoma Bravo, is exploring options including a potential sale, according to people familiar with the matter.
The Austin-based company is working with financial advisers to prepare a sale process that is expected to kick off early next year, said the people, who asked to not be identified because the details aren’t public. No final decision has been made and SolarWinds could opt to remain independent, the people said.
SolarWinds, whose shares had fallen about 44% since it went public in 2018, rose as much as 8.8% on Friday. The shares were up 6.9% to $9.50 at 12:45 p.m. in New York trading, giving the company a market value of $1.57 billion.
Representatives for SolarWinds, Thoma Bravo and Silver Lake declined to comment.
With more than 300,000 customers, SolarWinds provides software to information technology workers to help manage corporate infrastructure functions, according to its website. It comes to market as private equity funds prowl for software oriented businesses, which are appealing take-private candidates because of their steady cash-flow and consolidation prospects.
Vista Equity Partners agreed this week to buy business-to-business software company EngageSmart Inc. for about $4 billion.
Silver Lake and Thoma Bravo, two of the most active technology investors in private equity, took SolarWinds private in 2016 and brought it back to the public markets again almost three years later. Together the firms control about 68% of its common stock, according to data compiled by Bloomberg.
In late 2020, SolarWinds was at the center of major cyber-attack by hackers tied to the Russian government, which inserted a vulnerability into updates from one of its products. SolarWinds said at the time that as many as 18,000 customers may have been exposed.
(Updates with share gain in third paragraph.)
