Silver Lake intends to propose to acquire Qualtrics International (XM) - 13D

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(Updated - February 1, 2023 6:23 AM EST)

Silver Lake intends to propose to acquire Qualtrics International (NASDAQ: XM) - 13D

Recently, controlling stockholder SAP (NYSE: SAP) announced it plans to explore a sale of its stake.

Silver Lake said it currently intends to submit a proposal (which could also lead to one or more subsequent revised or different proposals) that could result in the Reporting Persons and/or their affiliates acquiring all or substantially all of the outstanding capital stock of the Issuer, which would result in a de-listing and de-registration of the Class A Common Stock.

Silver Lake currently owns a 14.9% stake in XM.

From the filing:

Non-disclosure Agreement

On January 26, 2023, SAP SE, the controlling stockholder of the Issuer, announced that it intends to explore a sale of its stake in the Issuer (the “SAP Proposal”). In connection with the announcement of the SAP Proposal, on January 31, 2023, Silver Lake Management Company V, L.L.C. (“SLMC V”) entered into an amendment and restatement of its pre-existing customary mutual non-disclosure agreement (the “Non-disclosure Agreement”) with the Issuer. Pursuant to the terms of the Non-disclosure Agreement, as amended, SLMC V has agreed that for a period of one year, among other things and subject to certain exceptions (including if pursuant to the request or approval of the Issuer), SLMC V and its affiliated investment funds, which includes the Reporting Persons, will not: acquire any voting securities of the Issuer; or participate in any solicitation of proxies to vote securities of the Issuer.

Exploration of Strategic Alternatives

In connection with the announcement of the SAP Proposal, the Reporting Persons have discussed and explored, and expect to continue to discuss and explore, various potential alternatives with respect to their investment in the Issuer. The Reporting Persons currently intend to submit a proposal (which could also lead to one or more subsequent revised or different proposals) that could result in the Reporting Persons and/or their affiliates acquiring all or substantially all of the outstanding capital stock of the Issuer, which would result in a de-listing and de-registration of the Class A Common Stock (referred to herein as a “De-listing”). The Reporting Persons may, at the same time or subsequently, also explore other strategic alternatives, including but not limited to: different kinds of corporate transactions involving the Issuer and its securities, such as

CUSIP No. 747601201 13D Page 10 of 14 pages

sales or acquisitions of shares, assets or businesses by the Issuer, including sales to or acquisitions from affiliates of the Reporting Persons; engaging with third parties to pursue other strategic transactions, including, but not limited to, a transaction that leads to a De-listing; or other business combination transactions such as a merger, reorganization, or other material transaction. There can be no guarantee that the Reporting Persons will make any such proposal, and if any such proposal is made, the Reporting Persons can provide no assurances that they will successfully consummate any proposed transaction.

The Reporting Persons and Mr. Durban, in his position as a director of the Issuer and Co-CEO and Managing Partner of Silver Lake Group, L.L.C. (“SLG”), the parent entity of the Reporting Person, intend to engage in communications, discussions and negotiations with members of management and of the board of directors, and their legal, financial, accounting and other advisors; potential partners and counterparties in any transaction; and current or prospective stockholders of the Issuer; and other relevant parties, regarding the various alternatives that may from time to time be under consideration by the Reporting Persons and/or their affiliates. To facilitate their consideration of such matters, the Reporting Persons have recently, or intend to, retain consultants and advisors and enter into discussions with potential sources of capital and other third parties. The Reporting Persons may exchange information with any such persons pursuant to appropriate confidentiality or similar obligations or agreements.

General

The Reporting Persons originally acquired the Class A Common Stock for investment purposes and, in addition to the more specific analysis set out above, intend to review their investments in the Issuer on a continuing basis. Any actions the Reporting Persons might undertake will be dependent upon the Reporting Persons’ review of numerous factors, including, but not limited to: an ongoing evaluation of the Issuer’s management, business, financial condition, operations and prospects; price levels of the Issuer’s securities; general market, industry and economic conditions; the relative attractiveness of alternative business and investment opportunities; and other future developments.

Subject to the terms of the Non-disclosure Agreement, as amended, and the other agreements described in Item 6 of the Schedule 13D, the Reporting Persons, at any time and from time to time may acquire additional securities of the Issuer or retain or sell all or a portion of the securities then held, in the open market or in privately negotiated transactions (including, without limitation, by distributing some or all of such shares of Class A Common Stock to the Reporting Persons’ direct or indirect members, partners or beneficiaries, as applicable, transferring shares of Class A Common Stock to affiliated transferees, or the entry into a total return swap, asset swap, repurchase or other hedging or financing transaction).

Other than as described above, none of the Reporting Persons nor, to the knowledge of the Reporting Persons, any of the individuals listed in Annex A attached hereto, currently have any plans or proposals that relate to, or would result in, any of the matters listed in Items 4(a)–(j) of Schedule 13D, although, depending on the factors discussed herein, the Reporting Persons may change their purpose or formulate different plans or proposals with respect thereto at any time.

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