N-Able (NABL) M&A Announcement summary

Deal rationale and strategic fit

• Acquisition enhances the platform with cloud-native XDR and MDR, unifying IT management, data protection, and security for MSPs and IT teams, addressing customer demand for integrated solutions.

• Builds on a successful partnership, with Adlumin previously being the fastest growing product offering and supporting the Ecoverse vision for unified endpoint management.

• Unlocks access to a $163B cybersecurity services market, growing at 13% annually.

• Leverages Adlumin's reseller and up-market relationships to expand sales channels and cross-sell opportunities.

• Accelerates business scale and growth through combined capabilities and addresses the cybersecurity talent shortage with 24/7 SOC capabilities.

Financial terms and conditions

• Aggregate consideration includes $100M in cash at closing, 1.57M shares issued, $120M in cash installments over two years, and up to $30M in earn-out payments based on performance.

• Deferred cash payments: $52.5M and $67.5M on the first and second anniversaries of closing.

• Total consideration expected between $236M and $266M, funded with cash on hand.

• Adlumin is projected to exit 2024 with $22M ARR, growing over 60% year-over-year, with 100% recurring revenue.

• Updated guidance reflects the acquisition, with 2024 revenue expected at $463M-$464.5M and Adjusted EBITDA at $166.3M-$166.8M.

Synergies and expected cost savings

• Integration expected to be immediately accretive to ARR growth and to contribute to free cash flow by Q4 2025.

• Magnifies reach via global go-to-market organization and 25,000 customers.

• Enables cross-sell, bundling strategies, and cost optimization while investing in product differentiation and growth.

• Unified platform delivers end-to-end detection, investigation, response, and resiliency across IT environments.

• AI-powered threat detection, ransomware protection, and compliance support enhance value for IT service providers.