Panopto Inc., a major provider of video management software, has reportedly offered to acquire competitor Kaltura Inc. for $383 million.

Panopto made the offer in a letter to Kaltura’s board that was obtained by Bloomberg on Thursday. The company’s bid values Kaltura, which is listed on the Nasdaq, at $3 per share. That represents a 27% premium to the Thursday closing price of the company’s stock.

Founded in 2006, Kaltura sells a suite of software products that organizations use to create and distribute video content. Kaltura also offers tools for a variety of related tasks. A company can use the software maker’s products to analyze how well its video content is received by users, generate captions and display ads, as well as perform other tasks.

One of the main markets where Kaltura competes is the education sector. Universities and other educational institutions use the company’s software to host virtual classes, create quizzes and track student participation.

Panopto likewise has a major presence in the education sector. The Seattle-based company provides a video management platform that includes many of the same features as Kaltura’s software offerings. Panopto counts Cornell University, NYU School of Law and Johns Hopkins University among its customers.

Panopto was acquired last year by K1 Investment Management, an investment firm active in the enterprise software market. The investment firm is believed to have purchased a 7% stake in Kaltura ahead of Panopto’s Thursday offer to buy the company. Additionally, K1 reportedly plans to help finance the proposed acquisition.

The $383 million acquisition offer that Panopto made is reportedly the third that the company has submitted to Kaltura’s board since early June. The previous two offers were rejected. 

Panopto Chief Executive Officer Tobi Hartmann wrote in a letter to Kaltura’s board on Thursday that “while we are disappointed that the board has to date decided to reject our revised proposal without engaging in a meaningful dialogue, we remain committed to pursuing a transaction between our two businesses.”

In the letter, Hartmann argued that the acquisition would enable Kaltura shareholders to realize “extraordinary value in a turbulent financial environment.” Shares of Kaltura are down more than 80% from their August 2021 peak. Additionally, Kaltura disclosed in its most recent earnings report that it had experienced “growth headwinds” last quarter, but the company expects growth to accelerate during the second half of 2022.

Hartmann also argued in the letter to Kaltura’s board that an acquisition would create opportunities to increase user engagement among customers. The combined company, the executive added, would be in a position to “drive an unparalleled and sustained level of value” immediately after the acquisition’s completion. 

Kaltura went public on the Nasdaq last July. Earlier, the company raised more than $140 million in funding from Intel Corp., Goldman Sachs and other investors. 

Photo: Nasdaq