Altair Issues Presentation Describing Why Altair Intends To Vote AGAINST Avalara's Proposed Sale To Vista Equity Partners

Author: Benzinga Newsdesk | September 22, 2022 08:26am

Altair Notes that the Transaction Comes at the Wrong Time, After a Flawed Process and at the Wrong Price

Reiterates that There is No Imperative to Sell Avalara

SANTA ROSA, Calif., Sept. 22, 2022 /PRNewswire/ -- Altair US, LLC ("Altair" or "we"), a pre-IPO angel investor in Avalara, Inc. (NYSE:  AVLR) (the "Company" or "Avalara") and one of the Company's largest shareholders, released a presentation describing it intends to reject the Company's proposed sale to Vista Equity Partners ("Vista"). The proposed sale is subject to a vote of shareholders at the upcoming Special Meeting of Shareholders scheduled to be held on October 14, 2022.

The presentation is available at: https://tinyurl.com/5n8v24ye

As outlined in the presentation, Altair believes that:

• The timing of the transaction is wrong: The Board decided to seek a sale of the Company during a time when macroeconomic factors like rising interest rates, inflation, supply chain disruptions and concerns over consumer spending have rattled the equity markets. At the same time, volatile capital markets have made financing more expensive and more difficult to obtain for acquirers. In our view, there was no urgent need to sell the Company; Avalara has ample cash and a bright future with a near-term path to achieving operating profitability.
• The sale process was flawed: The sale process appears to have been a spur-of-the-moment decision, driven by the desires of opportunistic acquirers and guidance from a financial advisor, Goldman Sachs, who was highly incentivized to pursue and close a transaction. The Board's "process" engaged with a very limited number of potential buyers, and given the close relationship between Vista, Avalara's financial advisor and members of the Avalara Board, we are concerned that Vista may have been the preferred buyer all along.
• The price is inadequate: The bad timing and deeply flawed process resulted in a price that we believe is insufficient to compensate Avalara shareholders for forfeiting their claim on the Company's future earnings and prospects. Vista's offer is well below sell-side analyst price targets prior to the deal and below Avalara's historical valuation multiple. We believe this price reflects near-term pessimism and transient market dynamics, rather than Avalara's true potential as a market leader with a strong competitive moat and a clear runway to further growth and profitability.

Altair encourages shareholders to read carefully the proxy materials published by the Company and those that are forthcoming from Altair.

Posted In: AVLR