Thoma Bravo to buy Dayforce in $12.3 billion deal

HR software provider Dayforce said on Thursday buyout firm Thoma Bravo will take it private in a $12.3 billion deal, including debt.

The offer represents a premium of 32.4% based on the stock’s closing price on August 15, when news of the deal talks was first reported.

Under the terms of the deal, Dayforce shareholders will receive $70 per share in cash, representing an equity value of $11.18 billion, according to Reuters calculations.

The software sector has emerged as an investment target due to resilient subscription services and recurring revenue in an economy weighed down by a deteriorating labor market, trade tariffs and erratic spending.

Dayforce’s stock was up around 2% in early trading after losing about 7% of its value so far this year, underperforming peers.

The company, which rebranded from Ceridian HCM Holding last year, faces strong competition in the industry, with enterprises preferring more established companies with larger operations.

A wave of deals in the human capital management industry in recent years signals a shift toward AI-driven, single-platform solutions, with acquisitions aimed at consolidating and enhancing the tools offered to clients.

Paychex announced its acquisition of rival Paycor for $4.1 billion at the start of the year, while Automatic Data Processing acquired WorkForce Software last year for about $1.2 billion.

The transaction, which includes a minority investment from a subsidiary of the Abu Dhabi Investment Authority, is expected to close early next year, Dayforce said.

Analysts have said a buyout would provide Dayforce some relief from its debt load, while Thoma Bravo’s deep pockets would help the company accelerate AI development and expand internationally.

Thoma Bravo, which had about $184 billion in assets under management as of March 31, is among the largest software-focused investors globally. The private equity firm has acquired or invested in more than 530 software and technology companies.