Instructure to be acquired by KKR for $4.8B

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Dive Brief:

• Instructure will go private in a $4.8 billion acquisition by global investment firm KKR.
• The global ed tech company, which offers schools and colleges a wide range of tools including Canvas and Parchment, has been publicly traded since 2021 after Thoma Bravo, Instructure’s existing majority owner, briefly took it private for a year in 2020.
• The definitive agreement outlines that KKR, with help from Dragoneer Investment Group, will acquire Instructure in an all-cash transaction for $23.60 per share — 16% more than its $20.27 share price on May 17, the last day before reports of an acquisition impacted shares, according to a press release.

Dive Insight:

The KKR acquisition is expected to provide support as Instructure ramps up investment in technology and innovation across its portfolio of learning products.

“Our leadership team laid out an aggressive go-forward strategy in our investor day presentation earlier this year,” Instructure CEO Steve Daly said in a statement. “We believe Instructure has a significant growth runway as we focus on core markets, unlocking new opportunities and continuing to build the Instructure Learning Ecosystem.”

Daly is expected to stay on in his current role post-acquisition.

Webster Chua, a partner at KKR, reiterated the focus on accelerating growth and scaling Instructure’s products, touting the “expansive” platform’s focus “on delivering strong student outcomes.”

According to the release, KKR will also offer opportunities for Instructure’s 1,700 employees to participate in a broad equity ownership program, stating that “team member engagement through ownership is a key driver in building stronger companies.”

The deal is expected to close later this year. Instructure will announce its Q2 earnings Aug. 2.

The move marks the second multi-billion dollar acquisition of an ed tech company in recent months. In June, Bain Capital announced it would acquire PowerSchool, a cloud-based student information system provider, for $5.6 billion in a deal that will also take the company private.