Silver Lake’s $400 Million Strategic Investment in Zuora

Simpson Thacher represented the affiliates of Silver Lake on the deal.

Silver Lake announced its strategic investment in Zuora Inc. Affiliates of Silver Lake will purchase $400 million of 3.95%/5.5% Convertible Senior PIK Toggle Notes due 2029 (the “notes”), with an initial conversion price of $20 per share. Under the terms of the agreement, upon the initial closing on or about March 24, 2022, Silver Lake will purchase $250 million aggregate principal amount of the notes with the remaining $150 million purchase expected to close within 18 months of the initial closing. Zuora has also agreed to issue Silver Lake warrants to purchase up to 7,500,000 shares of Class A Common Stock, exercisable for a period of seven years, and of which 2,500,000 shares shall be exercisable at $20 per share, and 2,500,000 shares shall be exercisable at $22 per share and (iii) 2,500,000 shares shall be exercisable at $24 per share. The transaction is subject to customary closing conditions.

Zuora provides a cloud-based subscription management platform, architected specifically for dynamic, recurring business models. Zuora’s solution enables companies across multiple industries and geographies to launch, manage and scale a subscription business, automating the entire subscription order-to-revenue process, including billing, collections and revenue recognition.

The Simpson Thacher team included Ken Wallach (Picture), Sunny Cheong, Ashley Yoon and Bethany Wong (Capital Markets); Jonathan Lindabury, Jennifer Levitt and Mimi Cheng (Banking and Credit); Russell Light and Edward Grais (Tax); Lori Lesser, Samuel Watters and Bobbie Burrows (Intellectual Property); and Jennifer Nadborny (Public Company Advisory Practice).

Involved fees earner: Bobbie Burrows – Simpson Thacher & Bartlett; Mimi Cheng – Simpson Thacher & Bartlett; Sunny Cheong – Simpson Thacher & Bartlett; Edward Grais – Simpson Thacher & Bartlett; Lori Lesser – Simpson Thacher & Bartlett; Jennifer Levitt – Simpson Thacher & Bartlett; Russell Light – Simpson Thacher & Bartlett; Jonathan Lindabury – Simpson Thacher & Bartlett; Jennifer Nadborny – Simpson Thacher & Bartlett; Kenneth Wallach – Simpson Thacher & Bartlett; Samuel Watters – Simpson Thacher & Bartlett; Bethany Wong – Simpson Thacher & Bartlett; Ashley Sunha Yoon – Simpson Thacher & Bartlett;

Law Firms: Simpson Thacher & Bartlett;

Clients: Silver Lake;

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Author: Youness Semri