Information on the Target

Basware is a prominent provider of Networked Procure-to-Pay solutions, boasting the largest open e-invoicing network across more than 180 countries. The company's cloud-based technology empowers enterprises to manage their expenditures comprehensively, mitigating financial risks and reducing operational costs through the automation of finance, procurement, accounts payable, and accounts receivable processes. Basware has played a pivotal role in promoting a transition towards a lower-carbon economy through effective digitization and automation strategies.

With a global customer base exceeding 6,500 businesses across 60 countries, Basware emphasizes the concept of Visible Commerce, which advocates for enhanced spend visibility to facilitate informed business decisions. Recognized as a Visionary in the 2021 Gartner® Magic Quadrant™ for Procure-to-Pay Suites, Basware prides itself on its innovative capabilities and commitment to delivering consistent value to its customers.

Industry Overview in Finland

Finland's technology sector has experienced significant growth in recent years, driven primarily by advancements in software solutions and a proactive approach to digital transformation among businesses. The country's emphasis on innovation has positioned it as a leading hub for technology startups and established companies alike, resulting in a robust ecosystem that fosters collaboration and development.

Specifically, the enterprise software market in Finland has seen a surge in demand for cloud-based solutions, as organizations increasingly seek to optimize their operations through automation and improve their financial management practices. This transition is supported by a growing recognition of the benefits of integrated systems that streamline procurement processes, enhance efficiency, and facilitate data-driven decision-making.

The Finnish government has also played a pivotal role in promoting digital commerce and e-invoicing, providing incentives for businesses to adopt advanced financial technologies. This supportive regulatory environment, combined with a highly educated workforce, enables Finland to remain competitive in the global technology landscape.

As e-invoicing and procurement automation continue to gain traction across industries, companies like Basware are well-positioned to leverage their expertise to meet the rising demands of businesses seeking greater efficiency and transparency in their financial operations.

The Rationale Behind the Deal

The voluntary public tender offer initiated by Accel-KKR, Long Path Partners, and Briarwood Capital Partners for Basware marks a strategic move to consolidate their investment in a leading firm within the e-invoicing and procurement sector. By acquiring approximately 96.2% of Basware's shares, the consortium aims to capitalize on the company’s robust market position and enhance its innovative capabilities.

This deal presents an opportunity for the consortium members to invest their insights and capital to drive growth and expansion within Basware, ultimately strengthening its offering to customers globally. The consortium's extensive experience in technology-focused investments will play a critical role in guiding Basware through its upcoming privatization process and future development.

Information About the Investor

Accel-KKR is a well-established technology-focused investment firm managing $14 billion in capital commitments. It specializes in software and tech-enabled businesses poised for growth, emphasizing strong partnerships with management teams to build value collaboratively. With a diverse array of capital solutions and experience across various transaction types, Accel-KKR is equipped to support Basware in enhancing its strategic capabilities.

Long Path Partners, founded in 2018, manages approximately $700 million in assets, focusing primarily on predictable businesses in the enterprise software and information service markets. Their strategic investment philosophy enables them to engage deeply with management teams, fostering long-term growth opportunities. Briarwood Partners, based in New York, complements this with a research-driven, value-oriented investment style, aiming to cultivate collaborative partnerships that enhance management capabilities.

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The acquisition of Basware by the consortium is a noteworthy strategic investment that could set the foundation for substantial long-term growth. With the rapidly evolving landscape of enterprise software and the growing need for digital financial solutions, Basware stands to benefit significantly from the increased support and resources provided by its new investors.

Moreover, the consortium's experience in driving innovation through operational efficiency aligns well with Basware's objectives of enhancing customer experiences and expanding its product offerings. This alignment of goals enhances the likelihood of successful execution, positioning Basware for a strong future in the industry.

However, the transformation process post-acquisition must be meticulously managed to maintain momentum and ensure continued customer satisfaction. The focus on product innovation and robust customer service will be crucial in cementing Basware's market leadership during this transitional phase.

Overall, the deal presents a compelling investment opportunity, reflecting the growing recognition of the critical role that automation and digital solutions play in the future of financial operations. The consortium's combined expertise could indeed propel Basware to achieve new heights in its operational and market capabilities.

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