Publicly listed transaction management company, thedocyard, is to buy out virtual data room (VDR) business Ansarada. The news has come just as iManage has bought Closing Folders, another deal platform.
The moves highlight both the growing consolidation in the legal tech sector and also the interest in connecting transaction management systems to other product categories. For example, last year Litera bought Doxly to add it to its workflow platform.
thedocyard, which is based in Australia and launched in 2015, but also has offices in London and Singapore, said that its aim is to ‘become a leading global SaaS company in deal technology and information governance technology‘.
The combined company is projected to have a market capitalisation of approximately $90m (Aus $125m). However, because thedocyard – which currently has 25 employees named on LinkedIn – is publicly listed on a stock exchange the announcement has come some time ahead of the deal’s completion, which is set for December this year.
The deal is also noteworthy in that VDR Ansarada, that started back in 2005, appears to be far larger than thedocyard, and has 164 employees listed on LinkedIn, yet it is thedocyard that is buying out the VDR company.
It’s also unusual for all but the largest of legal tech companies to be publicly listed, however it would appear that thedocyard is highly ambitious and a public listing no doubt has helped its profile and its ability to raise additional capital to make this deal.
One other recent example of a listed legal tech company is doc analysis business, Ayfie – see Artificial Lawyer story and AL TV interview.
Stuart Clout, Founder and CEO of thedocyard, stated in his comments to the market that the deal would ‘make the merged business a global force in the information governance technology market’.
All in all, an interesting week for the transaction management world, and it raises the question: what will the other companies in this segment, such as Simply Agree, do in response?
Moreover, it seems that thedocyard is definitely ‘one to watch’. If a company with just 25 employees has the ambition to publicly list and raise capital to buy a far larger company, then it’s highly likely that we can expect plenty of further growth, and perhaps some more acquisitions from this business. And, while it is based in Australia, its ambitions are clearly global, with, as noted, an office in London already.
That said, some financial observers in Australia have taken the deal to be a case of one company doing a merger in order to gain access to the publicly listed status that the other one has, i.e. that Ansarada wanted to be bought out by thedocyard so it would then be integrated into their Australian Stock Exchange listing. Hence this could be viewed – if you went with that perspective – as a sort of reverse takeover.
Either way, thedocyard has embarked on an interesting journey that will certainly change things a lot for them, and its future trajectory is likely to be rapidly accelerated by the deal.