RedPrairie agreed on Thursday to buy the JDA Software Group for $1.9 billion in cash, combining two providers of software to help companies manage their supply chains.
Under the terms of the deal, RedPrairie will pay $45 a share through a tender offer. That represents a 33 percent premium to JDA's price on Oct. 26, the day before reports began circulating that the company was looking to sell itself. It's also 16 percent higher than JDA's all-time-high stock price.
RedPrairie is owned by New Mountain Capital, which purchased the enterprise software maker in 2010. The private equity firm is contributing cash to help finance the deal, and Credit Suisse is also providing debt financing.
The combined company will be led by JDA's chief executive, Hamish Brewer, who will also become a director. The rest of the board will be comprised of RedPrairie's current directors, including Tim Pawlenty, the former governor of Minnesota, and Michael Mayoras, RedPrairie's chi ef executive.
“This transaction generates tremendous value for JDA shareholders, offering them a meaningful premium for their shares,†Mr. Brewer said in a statement. “This is a strong combination of two leading companies with highly complementary product suites.â€
New Mountain, which manages some $9 billion, bought RedPrairie as part of a focus on business software. And in JDA, it is acquiring a specialist in supply chain logistics.
RedPrairie was advised by Greenhill & Company, Credit Suisse and the law firm Fried, Frank, Harris, Shriver & Jacobson.
JDA was advised by JPMorgan Chase and the law firm DLA Piper, while its board was counseled by Cravath, Swaine & Moore.
