Thoma Bravo eyes stake sale in Command Alkon, sources say

By Milana Vinn

NEW YORK, May ‌14 (Reuters) - Thoma Bravo ​is exploring ​a sale of its stake in construction software maker Command Alkon, as the private equity firm tries to generate returns in pockets of software seen ‌as more resilient to broader AI disruption risks, according to four people familiar ⁠with the matter.

Thoma Bravo, which jointly owns Command Alkon with German building materials company Heidelberg Materials, is working ‌with investment bankers at Evercore on ‌a sale process for its roughly 55 percent stake in Command Alkon and has been fielding interest from other private equity firms in recent weeks, the sources said.

The ​deal could value Command Alkon at more than $1.5 billion, added the sources, who requested anonymity to speak about private deliberations.

Thoma Bravo declined to comment, while Heidelberg Materials, Evercore, and ⁠Command Alkon did not respond to requests for comment.

Heidelberg Materials, which is also the largest customer of Command Alkon, plans ​to retain its stake in the company as part of any deal, making the sale of Thoma Bravo's equity portion less attractive for most ​private equity buyers that prefer to assume full control ‌of an asset in leveraged buyouts, the sources said.

Command Alkon is on track to generate over $230 million in revenue and $92 million in earnings ⁠before interest, taxes, depreciation, and amortization (EBITDA) this year, and is expected to grow its revenues by 11% in 2027, according to two of the people familiar with the company's financials.

Thoma Bravo is seeking a valuation ⁠between $1.5 billion and $1.75 billion, those sources said.

Thoma Bravo acquired Command Alkon in 2020 and sold a 45 percent ​stake in the business the following year to Heidelberg in a deal that valued the company at $1.7 billion, the Wall Street Journal reported at that time.

The potential stake sale of Command Alkon follows another ‌recent Thoma Bravo deal in construction software. Last month, construction management software maker HCSS agreed to combine with the Build & Construct segment of ‌Germany's Nemetschek Group, with Thoma Bravo retaining a minority stake in the combined business.

Industry-specific software is seen ⁠as more resilient to AI disruption ‌risks than broader software categories, ​which have faced a recent selloff that has weighed on valuations across the sector.

(Reporting by Milana Vinn in New York; Editing by Echo Wang and ‌Chizu Nomiyama )

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