SABA SOFTWARE acquired by CORNERSTONE ONDEMAND

Private equity firm Hg (formerly HgCapital) has reached a definitive agreement to divest the HR software company Lumesse to trade buyer Saba Software, which is currently backed by private equity sponsor Vector Capital. The competitive sale process was run by US investment bank Jefferies Group LLC. Scheduled to successfully close by the end of 2018, the transaction brings to an end an eight-year holding period for Hg, which originally backed the platform through its £1.87bn HgCapital 6 fund. The integration of Lumesse into Saba Software—a company maintaining dual headquarters in Ireland and the US—will create a highly consolidated industry entity boasting a combined roster of 4,700 clients. For the seller, the exit concludes an investment cycle that saw proactive buy-and-build strategies, including the bolt-on acquisition of educational software business Edvantage Group. The divestiture successfully realizes an asset that had historically underperformed but registered notable operational progress over the previous year.

US-based private equity firm Vector Capital, which manages over $2.5 billion in assets, has successfully closed the take-private acquisition of California-headquartered Saba Software. Formally approved by the target's shareholders, this delisting transaction perfectly aligns with the sponsor’s core investment thesis of executing complex transformational buyouts and revitalizing mature, established technology assets. By partnering closely with the existing management team, Vector Capital is deploying strategic capital to support the next expansion phase of this legacy SaaS HR platform, ensuring a seamless operational transition and sustained excellence for all stakeholders. Vector Capital’s mandate is clear: to reinvigorate Saba’s core technology architecture, maximize client retention, and accelerate value creation across a massive installed base that already encompasses over 2,200 corporate customers and 31 million users across 195 countries. In lockstep with management, the sponsor intends to heavily leverage cutting-edge capabilities (such as the platform's proprietary machine learning) to further enhance Saba's intelligent talent management offering. To firmly consolidate Saba's market share and competitive moat, Vector Capital will execute an aggressive, hybrid value-creation playbook that pairs renewed organic top-line momentum with a disciplined, highly targeted buy-and-build M&A program.