Thoma Bravo to Acquire J.D. Power
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Thoma Bravo to Acquire J.D. Power

Thoma Bravo has agreed to acquire J.D. Power, a provider of data analytics and consumer intelligence, from London-based XIO Group.

J.D. Power is a global provider of consumer insights, advisory services, data and analytics. The company conducts surveys of customer satisfaction, product quality, and buyer behavior for industries ranging from cars to marketing and advertising firms. J.D. Power is best known for its customer satisfaction research on new-car quality and long-term dependability and its service offerings include industry-wide syndicated studies, proprietary research, consulting, training, and automotive forecasting.

The firm, led by CEO Dave Habiger, has over 800 employees and 16 offices serving North America, South America, Asia Pacific and Europe. The company is headquartered in Costa Mesa, CA (www.jdpower.com).

As part of the transaction, J.D. Power’s senior management team will be rolling over their ownership interest in the company. “We are thrilled to partner with Thoma Bravo, a firm that clearly understands our space and is well-positioned to help us develop new growth opportunities and continue on our current path of rapid expansion,” said Mr. Habiger. “This is an exciting step forward for our company, and we look forward to a fruitful partnership that will help us maximize our company’s fullest potential.”

In a related transaction, in May 2019, Thoma Bravo acquired Autodata Solutions Group from Internet Brands, a portfolio company of KKR. Autodata provides software and SaaS solutions that are used to increase the effectiveness of the automotive sales chain. The company’s products range from back-end automation systems that enable dealer-to-OEM vehicle ordering to data-driven marketing initiatives such as brand websites, dealer websites, and dealership sales tools. Customers of Autodata include most of the automotive companies in North America including Chrysler, Ford, GM, Nissan, Toyota, Mazda, Honda, Hyundai, Kia, Volvo, and Jaguar. The company, founded in 1990, is headquartered in London, ON and Troy, MI with additional offices in Portland, OR; Minneapolis, MN; and Calgary, AB (www.autodatasolutions.com).

The purchase price for J.D. Power was not released by either Thoma Bravo or XIO Group but industry sources report that the company was being valued at up to $1.9 billion. Further, a source familiar with this transaction reports that J.D. Power’s trailing twelve-month EBITDA is approximately $135 million.

J.D. Power was founded in 1968 by James David Power III. He later sold the company to McGraw Hill Financial in April 2005 for $400 million. XIO Group acquired J.D. Power in September 2016 from McGraw Hill Financial (now S&P Global) for $1.1 billion. “We saw J.D. Power as an iconic brand with strong upside potential and have been greatly impressed with the management team’s accelerating the digitization of the platform, including the successful implementation of AI initiatives and introduction of innovative analytics products,” said Joseph Pacini, CEO of XIO Group. “As we exit our investment, we wish them every success in the years ahead.”

“J.D. Power is one of the most recognized brands in the world, synonymous with a deep understanding of real-world customer experience, and it provides trusted insight that businesses of every type need in order to make critical strategic decisions,” said Scott Crabill, a managing partner at Thoma Bravo. “More recently, the company has expanded its leadership to include globally recognized experts in several industries, and it has dramatically expanded its analytics and product offerings, leveraging AI, the cloud and big data in ways that really showcase the brand’s significant near-term and long-term growth potential. We look forward to partnering with Dave Habiger and his team to further accelerate the business and build even greater value for J.D. Power’s employees, customers and partners globally.”

Thoma Bravo specializes in investing in application, infrastructure and security software and technology-enabled services businesses. The firm’s investments typically are in the form of take-private transactions, leveraged buyouts and growth equity investments in established companies that have or can quickly reach EBITDA of greater than $50 million. Thoma Bravo has offices in Chicago and San Francisco (www.thomabravo.com).

XIO Group has more than $5 billion of committed capital and invests in companies across North American and Europe. The firm is headquartered in London with additional offices in Germany, Switzerland, Hong Kong and mainland China (www.xiogroup.com).

Financing for the transaction is being provided by RBC Capital Markets, KKR and SunTrust Bank.

Evercore is the financial advisor to J.D. Power on this transaction.

This transaction is expected to close by year-end.

© 2019 Private Equity Professional | July 31, 2019

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