Takeaways by Saasverse AI
- Thoma Bravo | Acquisition | $11 Billion+ | HR Tech SaaS
- Negotiations in progress; Dayforce valued at approximately $11 billion, including $1.2 billion in debt.
- Significant move amid heightened HR software M&A activity; reflects private equity's appetite for undervalued SaaS assets.
Dayforce, the AI-driven human capital management (HCM) software provider formerly known as Ceridian HCM, is reportedly in advanced acquisition talks with private equity powerhouse Thoma Bravo. According to Bloomberg, the proposed deal would value Dayforce at over $11 billion, including $1.2 billion in debt. The announcement triggered a sharp 28% surge in Dayforce's stock price, bringing its market capitalization to approximately $10.6 billion.
Dayforce specializes in AI-powered solutions for recruitment, payroll, and employee development, catering to industries such as healthcare, retail, hospitality, and financial services. The company went public in 2018 and has since demonstrated robust growth, with revenues increasing over 70% between 2021 and 2024. Despite achieving profitability, Dayforce has faced significant stock market challenges, with its share price declining nearly 60% from its 2021 peak amid broader post-pandemic market corrections in enterprise software.
This valuation downturn has piqued the interest of private equity firms like Thoma Bravo, which has maintained an aggressive acquisition strategy in 2023. Earlier this year, the firm acquired Boeing’s digital assets for $10.6 billion and restaurant software developer Olo Inc. for $2 billion. Thoma Bravo is also in discussions for a potential acquisition of Verint Systems Inc., signaling its focus on high-value SaaS and technology assets.
The Dayforce acquisition reflects growing M&A activity in the HCM software sector, a trend underscored by recent deals such as Paychex’s purchase of Paycor HCM and ADP’s acquisition of WorkForce Software. These transactions highlight the strategic importance of scalable HR tech solutions in addressing workforce management challenges across various industries.
“ This proposed deal underscores the enduring attractiveness of HR SaaS companies with stable cash flows, particularly in an uncertain economic climate. For Thoma Bravo, Dayforce represents a compelling opportunity to capitalize on undervalued assets in a critical enterprise software vertical. ” Saasverse Analyst comments.
Saasverse Insights
The Dayforce acquisition aligns with a broader trend of private equity firms targeting undervalued SaaS companies with strong fundamentals. As enterprise IT budgets recalibrate post-pandemic, businesses that deliver essential, productivity-enhancing solutions—like those in HR tech—are likely to see sustained demand. For SaaS entrepreneurs and enterprise leaders in Asia and beyond, this serves as a reminder to build resilient business models capable of weathering market cycles while maintaining steady cash flow and profitability. The HR software market, particularly with AI integration, remains a promising domain for innovation and investment.