Avalara Inc., a major provider of tax compliance software for businesses, today announced that it has agreed to be acquired by Vista Equity Partners in an $8.4 billion deal.

The announcement comes about a month after reports of the transaction first emerged. Vista Equity Partners’ $8.4 billion offer amounts to $93.50 per Avalara share, a 27% premium over its last closing price before the acquisition reports. The deal is expected to close by year’s end.

Avalara provides a cloud-based tax compliance platform that automates tasks such as applying sales tax to store purchases and eases the associated calculations. The platform also offers other features, including a tool that helps companies track regulatory changes. Avalara provides its core feature set alongside industry-specific capabilities for companies in industries such as the retail and manufacturing segments.

According to Avalara, its platform is used by more than 30,000 organizations that range from small businesses to publicly traded enterprises. The company counts Box Inc., Pinterest Inc. and Adidas AG among its customers.

Avalara released its second-quarter earnings report in conjunction with today’s acquisition announcement. The company logged a $55.8 million net loss on $208.6 million in revenue during the three months ended June 30. Compared with the second quarter of 2021, Avalara’s revenue increased 23%.

“For nearly two decades, Avalara has ambitiously pursued its vision to automate global compliance, making tax less taxing for businesses and governments around the world,” said Avalara co-founder and Chief Executive Scott McFarlane. “We are pleased to partner with Vista and will benefit from their expertise in enterprise software as we build and improve upon our cloud compliance platform.”

Avalara said it plans to work with Vista Equity Partners to enhance its go-to-market strategy and expand internationally. In parallel, the company intends to make more acquisitions to support its growth plans. Avalara has acquired several other players in the tax compliance software market over the past few quarters to expand its product portfolio.

“Vista has built a reputation as a preferred partner for founder-led, next-generation software companies,” said Monti Saroya, the co-head of Vista Equity Partners’ Flagship Fund and a senior managing director at the firm.

The acquisition of Avalara is the latest in a series of recent enterprise software investments made by Vista Equity Partners. Previously, the investment firm bought a majority stake in BetterCloud Inc., the developer of a platform that helps companies manage the software-as-a-service applications used by their workers. Vista Equity Partners earlier teamed up with several other investors to acquire Citrix Systems Inc. for $16.5 billion.

Image: Avalara