Shareholders of Seattle-based tax software company Avalara Inc. (NYSE: AVLR) approved the company's proposed $8.4 billion sale to private equity firm Vista Equity Partners on Friday.
About 80% of outstanding shares were represented, according to Avalara, and 84% of those votes went in favor of the acquisition, making 66% of total outstanding shares in favor of the acquisition. The company expects the deal to close Wednesday.
Avalara announced the acquisition by Austin-based Vista Equity in August. The deal would take Avalara private and would have Vista Equity pay $93.50 per share to acquire Avalara, a 27% premium above the company's stock price at close July 6, which was the last day of trading before news reports surfaced about the deal.
The vote to approve the acquisition came despite opposition from a few investors.
Avalara is facing seven open lawsuits from individual shareholders that say, among other claims, the company's leadership and board stand to benefit massively from the deal while individual shareholders would largely miss out. The lawsuits also point to a Sept. 12 proxy statement, which the lawsuits say misrepresented and omitted key financial information, released to shareholders designed to encourage the acquisition.
In an Oct. 4 filing with the Securities and Exchange Commission in response to the lawsuits, Avalara made certain changes to the proxy statement but said the lawsuits "are without merit and that no further disclosure is required to supplement the proxy statement under applicable law."
In addition to lawsuits from individual investors, multiple shareholder firms opposed the deal and planned to vote against it. Avalara released a presentation in late September urging shareholders to accept the deal, citing various negative predictions if Avalara remained an independent company. That same month, Avalara highlighted a report from a third-party proxy advisory firm that noted Avalara's "expected underperformance" as a key reason to sell.
Avalara, which was founded in 2004 and went public in 2018, makes software that helps with sales and use tax, consumer use tax and international compliance. Avalara had 4,465 full-time employees at the end of last year, according to an SEC filing.
