Summary
- Dun & Bradstreet went public less than one and a half years since it was taken private.
- Within this short time frame, the company has delivered impressive margin improvements.
- This is to be applauded, although I doubt if the company is the true winner in the long run, while valuations are quite demanding.
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It has been a quick run for private equity owners, including Black Knight, CC Capital, Cannae Holdings and Thomas H. Lee Partners, after they took Dun & Bradstreet (DNB) private late in 2018.
Less than two years since the announcement of that deal, the company has now been taken public again, enjoying a solid bump on their opening day as Dun & Bradstreet has maintained its stock symbol. Unfortunately, the current valuation is a lot higher than it was when the company was previously public just one and a half years ago, probably the reason why private equity owners have timed this offering at this point in time.
The Deal, The Company
The acquisition of Dun & Bradstreet, which was announced late in 2018, actually closed early in 2019, February of that year to be more precise. That deal took place at $145 per share. Yet, more interesting is the enterprise value, with the company valued at $6.9 billion at the time, comprising of a $5.4 billion equity valuation and $1.5 billion in net debt assumption.
As this deal is so fresh, the 2018 numbers are of course still reported in the S1 filing, revealing revenues of $1.72 billion that year on which the company reported operating earnings of $429 million and adjusted EBITDA of $569 million.
As the company is used by many financial professionals and only had gone private quite recently, most users will probably be familiar to some degree with the company. For those who are not, Dun & Bradstreet is a global provider of business decision data and analytics with a mission to enable trust for clients in decision-making.
Other applications include visibility, compliance with laws, and sales force productivity, as the size and coverage of the company is immense. The company has information on more than 360 million businesses, as the company provides this data to some 135,000 global customers.
The company generates about 60% of sales from its finance and risk business, comprised of finance, procurement and compliance services. Sales and marketing makes up the remainder of 40% of sales, comprised of namesake functions.
