(Reuters) -Private equity firm EQT AB said late on Thursday it plans to take SUSE private in a deal to be funded by a special dividend issued by the Frankfurt-listed software company.
EQT, which owns around 79% of SUSE, will offer shareholders 16 euros per share, a premium of nearly 67% to their closing price on Thursday and valuing the company at 2.72 billion euros ($2.96 billion).
The offer is a significant markdown from their 30-euro IPO price in May 2021.
Shares in SUSE surged nearly 60% in early Frankfurt trade on Friday.
"Our decision has matured over the past few months," EQT partner Johannes Reichel told Reuters.
EQT's holding company Marcel in a statement late on Thursday said its decision followed execution challenges and several changes in the past 12 months. It said this was further compounded by the low liquidity of the company’s stock, which impacted SUSE’s operating performance and market valuation.
The tech firm recently completed a management revamp in which Dirk-Peter van Leeuwen was appointed chief executive in May.
EQT will finance the buyout of shareholders through an interim dividend issued by SUSE, which in turn will be funded with cash at hand and up to 500 million euros worth of loans.
EQT's Reichel said the private equity firm was not under time pressure to exit SUSE.
"I don't think we will sell in the next 12 months - but we probably won't stay invested for another four years either," he said.
SUSE, whose headquarters are now in Luxembourg, is an enterprise software company whose open-source software helps run applications on cloud servers, mainframe computers and devices at the edges of networks.
($1 = 0.9188 euros)
(Reporting by Kanjyik Ghosh in Bengaluru, Emma-Victoria Farr in London and Alexander Huebner in Munich; editing by Matthew Lewis and Jason Neely)