GTCR Math: Vocus Plus Cision Equals…

Usually an acquisition generates questions that we can all see coming a mile away because the move is  readily apparent. The synergies are right there on the table and there is no mistake; it could be to break into a new market, to expand into an existing market, to enhance current service offerings with complimentary products or dominate market share.

There were whispered conversations over the last year that both Cision and Vocus were looking to sell. This came out into the light in Q1 this year and almost as quickly they were both snapped up by GTCR.

When the two heavyweights in Public Relations software solutions arena are owned in whole or in part by the same PE though the questions surrounding the acquisition become very pointed.

This got me thinking about GTCR math.


Let’s start with Vocus: shareholders* were doing back flips when the all-cash transaction was announced April 7th at approximately $446.5 million. This represents a premium of 48% over Vocus’ closing share price on April 4th. GTCR sees something here.

Compared that to the Cision bid from Blue Canyon Holdings (sub of GTCR) of 20.1 per cent of shares and votes in Cision along with Fairford Holdings Finance AB, Cyril Acquisition AB, Lannebo Fonder and Accendo Capital SICAV-SIF with 43.3 per cent of shares and votes in Cision for a grand total of 63.4 per cent of shares. The total bid is approximately $125.7 million.

So What Happens Now?

$446.6M + $125.7M = Over half a Billion, that’s Billion with a ‘B’ invested in two companies with some very similar offerings and a huge part of the market share in the same.

Vocus clearly comes out on top nearly doubling their valuation. Kudos to them for swinging such a high price. This was achieved in large part due to the iContact acquisition made in 2012 for $169M which has been instrumental in Vocus’ pivot to the cloud marketing space. Cision on the other side of the equation is priced much more reasonably, albeit with a less diversified offering, and kudos to Blue Canyon Holdings on their savvy purchase.

Vocus sees it this way: “For our shareholders, this agreement provides an opportunity to realize cash value for their shares at a significant premium to historical share prices,” said Rick Rudman, CEO of Vocus. “For our employees and customers, we believe that joining forces with GTCR creates a significant opportunity to utilize each other’s strengths and move even faster toward our vision of creating innovative software and making our customers successful.”

Cision has remained tight lipped so one can only speculate. It’s obvious Meltwater’s offer is a no go at this point, and it doesn’t appear that Cision wanted that marriage anyway. Although it would have been a fantastic move on Meltwater’s part had it been successful.


In the near term (next 3 months), nothing really changes for the customer base. Once everything is finalized though customers will be offered to move to the “new solution” and given the benefits and incentives customary with such a change. With limited options of other comparable platforms it is highly likely they will renew their subscription. Where there may be some drain is on the lower usage and lower budget clients who may opt to go with a product that focuses on a targeted part of their workflow.


The very word acquisition gets all employee’s thinking “What happens to me now?”. Those resumes are getting updated, LinkedIn recommendations are going to get requested, suits are going to need pressing and interviews will begin. The hard fact is not everyone survives the acquisition. In this case anyone working in Sales, Support, Development, Training, Professional Services, Research, well pretty much everyone has a target on their back. Don’t think so? Take this into account. When Vocus purchased iContact in February 2012 one-third of the 250 iContact employees were pink-slipped  only 10 business days later. It was all about redundancies and Vocus increased the quota carrying sales reps to 489 by year end compared to 270 the previous year which was core to the cloud marketing  suite go to market strategy.

The Industry

Here is what the numbers tell us if these two are combined. The Contact Management space would be dominated and the Monitoring space could easily overtake Meltwater with a bit of innovation and salesmanship.

From where I sit the fact that one company will own the two largest PR software companies means there will be a only one version of both standing when everything settles. The logical outcome is to pull apart those successful components from each and create the defacto PR solution. Now if GTCR still has an appetite and really wants to close this market up all they need to do is pick up PRNewswire to round out the offering and fund some further investment into the social media engagement/listening/monitoring component.

Vocus’ cloud marking suite would offer the growth that can no longer be found in the PR space. PR has changed and the budgets that support the PR effort are increasingly under the Marketing P&L. This doesn’t mean PR’s don’t need a tool for their workflow, it just means that the workflow offered has to take Marketing and PR into account in that order.


*I own a handful of shares in Vocus from way back when I worked there.

2 Replies to “GTCR Math: Vocus Plus Cision Equals…”

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