Sponsors Take KORE Group Private
IoT provider KORE Group Holdings is being taken private by PE firms Searchlight Capital Partners and Abry Partners in an all-cash deal. The move is a classic sponsor playbook, targeting an undervalued public tech company with strong recurring revenue for a future turnaround and exit. The deal is already facing scrutiny from law firms over its fairness to public shareholders.
The deal values KORE at an enterprise value of approximately $726 million. With KORE's last twelve months (LTM) revenue at $284 million and LTM adjusted EBITDA at $61.4 million, this valuation implies an EV/EBITDA multiple of roughly 11.8x and a P/S ratio of 0.35x. This take-private follows KORE's challenging performance since its 2021 de-SPAC transaction, which initially valued the company at a pro-forma enterprise value of $1.01 billion. The company has since faced declining revenue growth and negative profit margins, creating the undervalued situation that attracted the private equity sponsors. The $9.25 per share cash offer represents a 691% premium to the closing price on December 18, 2024, and a 132% premium to the price on November 3, 2025, the day before the sponsors submitted an initial $5.00 per share proposal. This substantial premium was a key factor in the unanimous approval from KORE's board and a special committee of independent directors. The transaction is not subject to a financing condition, with Searchlight providing equity commitments of $175 million. Both Abry and Searchlight are rolling over their significant existing stakes; Abry owns about 28% of KORE's common stock, while Searchlight holds all Series A-1 preferred stock with a ~$275 million liquidation preference and warrants for ~14% of common stock. The investigation by shareholder rights law firms centers on potential conflicts of interest given the sponsors' pre-existing ownership and board representation. The core of the inquiry is whether the special committee conducted a fair sales process to ensure the $9.25 per share price is the best possible outcome for public, unaffiliated shareholders. Searchlight Capital, founded by Eric Zinterhofer, Oliver Haarmann, and Erol Uzumeri, and Abry Partners both have extensive investment history in the TMT (Technology, Media, & Telecom) and business services sectors. Their strategy will likely focus on leveraging KORE's recurring revenue base and streamlining operations away from the scrutiny of public markets to foster long-term growth and a profitable future exit. The deal requires several approvals before its expected close in the second or third quarter of 2026. These include clearance under the Hart-Scott-Rodino (HSR) Antitrust Improvements Act, review by the Committee on Foreign Investment in the United States (CFIUS), and, crucially, approval from a majority of the minority shareholders (a vote by holders of common stock not affiliated with the sponsors).
