Investment firm Thoma Bravo has reached an agreement to buy German software company EQS Group in a deal valued at approximately €400m ($434.29m).

Under the terms of the agreement, the US-based private equity company will offer €40 per share in cash for all outstanding shares of EQS.

The offer price is 53% premium to the XETRA closing price of EQS’ shares on 15 November 2023, the last the day before the agreement was announced, Thoma Bravo said.

EQS is engaged in developing and offering cloud-based software solutions for investor relations, corporate compliance, and environmental, social, and governance (ESG).

As part of the agreement, Thoma Bravo has agreed to subscribe to 10% capital increase of EQS’ share capital at the offer price following the completion of the deal.

Thoma Bravo said its investment in EQS will allow the technology vendor to support growth initiatives and potential acquisitions to capture the European compliance software industry.

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As of 30 June 2023, software-focused Thoma Bravo had over $131bn in assets under management.

This is Thoma Bravo’s first investment in a German company.

EQS founder and CEO Achim Weick said: “Working with Thoma Bravo will allow us to enter into the next chapter of our growth journey. With its expertise in software, demonstrated track record and passion for delivering transformative technologies, Thoma Bravo is the right partner to support our growth ambitions.”

Thoma Bravo partner Irina Hemmers said: “EQS is a unique German software enterprise at the forefront of three megatrends: digitisation, regulation and ESG, which have been driving its profitable growth.

“Together with Achim Weick and the experienced team at EQS, we will build and expand the platform into a pan-European Compliance and ESG champion for the benefit of customers’ evolving needs in this very dynamic market.”

Through irreversible agreements with key shareholders, Thoma Bravo has already secured nearly 60% of the total capital of EQS shares.

EQS management and supervisory board are supporting the offer, which will see EQS delist from the stock exchange.

Subject to regulatory approval and other conditions, the deal is expected to complete by January or February 2024.