N-able May Be A Potential Takeover Target: RBC Analyst

N-able is viewed as a potential takeover target after software competitor Datto was acquired by Kaseya for $6.2 billion.

N-Able may be the next software firm being eyed for an acquisition, according to one analyst.

RBC (Royal Bank of Canada) analyst Rishi Jaluria said on CNBC last week that he views N-able as a potential takeover target.

In an interview with CNBC last week, Jaluria said that “we’re heading into a period with high inflation, high interest rates [and] worries about a recession.”

“More and more, the board of directors have to take acquisition offers seriously from private equity,” he said.

Jaluria noted that many companies -- not just Wakefield, Mass.-based software firm N-able -- are ripe for acquisition, such as New Relic and Dropbox.

He said tech giants like Microsoft, SAP and Oracle “are looking at some of these multiples coming down so much and saying, ‘Hey this is a great time to consolidate some IT spend and really take advantage of the major pullback we’re seeing here,’” Jaluria said.

He said what makes sense for an acquisition includes “pull back to such low levels and trade at such cheap multiples on profitability that we think they are attractive to some big acquirers.”

CRN reached out to N-able and RBC for further comment.

N-able, which provides a full technology stack with integrated monitoring, management, security and ticketing to over 25,000 MSPs worldwide, spun out of SolarWinds in 2021, eight years after it was acquired. Since then its stock price has dropped about 32 percent. The company has a current market cap of $1.82 billion.

Signs of a potential takeover come after competitor Kaseya announced in April it would acquire Datto for $6.2 billion.

[Related: Kaseya’s Datto Acquisition: 5 Big Things MSPs Should Know]

Kaseya CEO Fred Voccola told Dealreporter that Datto having 10 to 15 bids puts N-able in a good position.

N-able, trading with the ticker symbol ‘NABL,’ went public on the New York Stock Exchange last summer at $15.37 per share.

As its own company, N-able’s first focuses were to invest in developing additional technologies to market and enhancing the ability of MSPs to leverage more analytics and reporting, N-able CEO John Pagliuca previously told CRN.

“Our No. 1 job is to help MSPs enable the small and medium enterprises to continue on their evolutionary journey,” Pagliuca told CRN after the spin-off. “Obviously that’s pushing to the cloud. Obviously that’s making sure that their data is protected. Obviously, as [clients’] workforces are becoming more and more distributed, hybrid, ensure they are gaining access to everything. But that’s complicated. And where we really matter the most is where it’s the messiest for the most for the MSPs. And that’s what separates us from our competitors.”

N-able stock stood at $9.85 per share Tuesday morning, up about five percent over the last five days.