WASHINGTON - ZeroFox Holdings, Inc. (NASDAQ:ZFOX), a cybersecurity firm specializing in external threat mitigation, has agreed to be acquired by Haveli Investments in a transaction valued at approximately $350 million. The all-cash deal will result in ZeroFox stockholders receiving $1.14 per share, which is a 45% premium over the volume weighted average price for the 90-day period ending February 2, 2024.
The transaction, which has been unanimously approved by ZeroFox's Board of Directors and a Special Committee of independent directors, is expected to close in the first half of 2024. It is subject to customary closing conditions, including ZeroFox stockholder approval and regulatory clearances. Once the acquisition is complete, ZeroFox will transition from a public entity on the Nasdaq Global Market to a privately held company.
ZeroFox's Chairman and CEO, James C. Foster, expressed that the partnership with Haveli Investments aligns with their mission to protect customers from sophisticated cybersecurity threats. He believes the acquisition is a compelling outcome for stockholders, especially considering market volatility, and positions ZeroFox for further growth.
Ian Loring, Senior Managing Director at Haveli Investments, also conveyed enthusiasm for the partnership, highlighting ZeroFox's role in digital risk protection and threat intelligence. He anticipates working with ZeroFox's leadership to accelerate the company's growth amid an evolving cybersecurity landscape.
Leading up to the agreement, ZeroFox's board conducted an extensive review of capital structure alternatives and engaged with multiple potential partners, ultimately determining that Haveli Investments was the best path forward for customers, employees, and stockholder value maximization.
Piper Sandler and Stifel are serving as financial advisors to ZeroFox, with Venable LLP as its legal advisor. Haveli Investments is advised by BTIG and Evercore for financial matters, with BTIG also advising on debt financing structure, and Ropes & Gray LLP as legal advisor.
ZeroFox provides AI analytics, digital risk and privacy protection, threat intelligence, and response capabilities to combat various external digital threats.
This news is based on a press release statement.
InvestingPro Insights
ZeroFox Holdings, Inc. (ZFOX) has recently made headlines with its acquisition by Haveli Investments, and investors are keenly observing the company's financial health and market performance. According to InvestingPro data, ZeroFox has a market capitalization of $113.97 million and is trading at a low Price / Book multiple of 0.3, which could suggest that the company's assets are undervalued by the market.
Despite a challenging year, with the stock price falling by 71.36% over the last year, there have been positive developments in the short term. ZeroFox has seen a strong return over the last three months, with a 79.41% increase, and a 25.62% increase over the last month, indicating a recent uptick in investor confidence.
InvestingPro Tips highlight that ZeroFox operates with a significant debt burden and is quickly burning through cash, which are concerns for long-term sustainability. Additionally, analysts do not anticipate the company will be profitable this year, and short-term obligations exceed liquid assets, indicating potential liquidity issues. However, analysts have revised their earnings upwards for the upcoming period, and they anticipate sales growth in the current year, which could signal a positive outlook for revenue generation.
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