Cornerstone OnDemand to go Private as PE Firm Takes Ownership

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Cornerstone OnDemand said it will be acquired by the private equity firm Clearlake Capital. Under the terms of their agreement, Clearlake will acquire the outstanding shares of Cornerstone common stock for $57.50 per share in cash. The deal gives Cornerstone an estimated value of approximately $5.2 billion, the company said.

The $57.50 per share purchase price represents a premium of approximately 31% to Cornerstone’s unaffected closing stock price on June 1, 2021. Once the transaction is done, Cornerstone will become a private company.

Cornerstone OnDemand will be acquired by the private equity firm Clearlake Capital, in a deal worth nearly $4 billion. #HR #HRTech @CornerstoneInc Share on X

“With this transaction, we plan to continue to pursue new software capabilities that advance our customers’ efforts to optimize workforce agility, transform skill development, deliver personalized, engaging growth experiences and align their organizations around a shared definition of success,” said Cornerstone CEO Phil Saunders.

Adam Miller, Cornerstone’s co-founder and co-chairman of the board, said that as a result of the transaction, “Cornerstone will be even better positioned to innovate, to capitalize on our market opportunities and to extend our platform.” In addition, the move will give the company “added significant strategic flexibility and financial resources,” he said.

“We believe there is a significant opportunity to strategically position Cornerstone in the market as a leading platform and industry consolidator,” added Clearlake Managing Partner  Behdad Eghbali. “We look forward to partnering with the management team to drive value through both organic growth acceleration and inorganic transformation.”

The transaction is expected to close during 2021’s second half.

Promising Results

News of the acquisition came just as Cornerstone released its second-quarter results. 

During the quarter, revenue rose 16.3% compared to the year-ago period, to $214.3 million. Subscription revenue came in at $206.8 million, a 16.7% increase from the previous year.

In 2020, Cornerstone acquired the talent experience solutions provider Saba Software in a cash and stock transaction valued at about $1.4 billion. At the time, the company said the acquisition would give it an “an expanded reach and ability to help a larger, diverse group of clients realize the potential of their people.”  

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