Kaseya acquires Datto for $6.2 billion
The market for software integrators intended for MSPs is concentrating with the takeover of Datto by Kaseya for an amount of 6.2 billion dollars. This operation should enrich Kaseya’s product and customer portfolio.
As the managed service provider (MSP) market enters a new phase of consolidation, Kaseya, a publisher specializing in the integration of technological bricks resulting from takeovers (storage, infrastructure management, security) has announced its intention to acquire Datto for $6.2 billion. The cash transaction which is expected to close in the second half of 2022, subject to customary closing conditions, will be funded by a consortium of private investors led by Insight Partners, backed by a “significant investment” from TPG Capital and Temasek, and a Sixth Street stake.
Under the terms of the agreement, Datto shareholders will receive $35.50 per share, representing a 52% premium to the March 16 share price of $23.37. “This is great news for Kaseya’s global customers, as they will be able to benefit from more functional, innovative and integrated solutions upon purchase,” said Fred Voccola, CEO of Kaseya. “Datto’s commitment to its customers and employees is legendary. Our missions and priorities make Kayesa a natural partner for Datto, and we will help our customers achieve unparalleled levels of success,” added the CEO.
According to Mr. Voccola, the companies will operate “completely independently” until the transaction is finalized. “Kaseya is known for its outstanding track record in brand retention, preserving the culture of the companies we acquire, and the added quality we bring to products,” he added. “We can only be very excited to serve Kaseya and Datto customers together.”
The move comes less than three months after Datto acquired threat detection and response provider Infocyte, which enabled the MSP to extend its security capabilities to endpoint and cloud environments. In March 2021, he had already acquired the Israeli company BitDam specializing in the detection of cyber threats. “Datto has always been focused on creating world-class technology for SMBs and delivering it through its global network of MSPs to align its growth with the channel,” said Tim Weller, CEO of the company. “Associating with Kaseya brings together a broader range of technology products to create additional opportunities for managed service providers. The continued investment in the growing global MSP community is very exciting and this important transaction once again validates the channel,” said the CEO.
A look back at Datto’s story
In October 2017, Datto’s mega-merger with Autotask shook up the managed services market considerably. At the time, Datto had been acquired by Vista Equity Partners, an investment firm focused on software, data and advanced technologies, and the provider operated under the same roof as Autotask, itself owned by Vista since June 2014. Datto offered combined backup and disaster recovery solutions with IT service management capabilities. Later, in January 2019, the company appointed Tim Weller as CEO, replacing founder Austin McChord who stepped down from day-to-day management of the business at the end of 2018. In October 2020, Datto made its introduction to the New York Stock Exchange (NYSE).
Meanwhile, in July 2021, thousands of businesses around the world were hit by a supply chain attack as hackers exploited a vulnerability in Kaseya’s VSA remote computer management tool to deploy REvil ransomware. In response, Kaseya had shut down its cloud service and asked all users with on-premises deployments — including many MSPs — to shut down vulnerable servers immediately until a fix was released. This isn’t the first time cybercriminals and ransomware gangs have targeted MSPs for easy access to corporate networks. Defending against this attack vector is not easy for many companies, as outsourcing IT administration cannot be done without giving MSPs highly privileged access to their networks and systems.