Investment company EQT is exploring options for selling software company SUSE. According to insiders, a transaction could value the Linux company at up to approximately $6 billion, or more than €5 billion.
According to Reuters, the exploration is still in its early stages, and it is not certain that a sale process will actually follow.
EQT has engaged investment bank Arma Partners to explore a potential sale. Arma Partners will gauge interest among other investors, particularly private equity firms. According to sources, the discussions are confidential and are primarily intended to explore the market.
EQT has been involved with SUSE for many years and delisted the company in 2023. At that time, the company’s value was set at approximately €2.72 billion. If a sale for the aforementioned $6 billion were to take place, it would mean SUSE’s valuation has roughly doubled in a relatively short period.
The potential sale comes at a time when software companies are under pressure on the stock market. The rapid rise of generative AI is shifting expectations in the technology sector. Some investors fear that new AI tools will make certain software categories less relevant, affecting valuations and making it more difficult to finance acquisitions.
Infrastructure software benefits from AI investments
At the same time, other investors see opportunities for infrastructure software providers. Organizations that develop and implement AI applications need reliable platforms for their workloads. Companies that focus on enterprise infrastructure can therefore benefit from the growing demand for scalable IT environments.
SUSE is estimated to have annual revenues of approximately $800 million and EBITDA of more than $250 million. Depending on market conditions, sources say the company could fetch between $4 billion and $6 billion in a sale.
The German software company was founded in 1992 by Roland Dyroff, Thomas Fehr, Hubert Mantel, and Burchard Steinbild. The name SUSE stands for Software und System Entwicklung. The company grew into a major provider of Linux solutions for enterprises and is considered one of the first to offer an enterprise Linux distribution.
SUSE has changed hands several times in recent decades. In 2003, the company was acquired by Novell. It then ended up with The Attachmate Group. After a merger with Micro Focus, SUSE was finally bought by investor EQT in 2018, which later re-listed the company on the stock exchange and then delisted it again.