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South Florida is now home to a tech company worth $11 billion

Ultimate Software’s patch on the Miami Heat’s new Nike jerseys was presented to the public Thursday, Sept. 21, 2017 at a press conference at AmericanAirlines Arena.
Ultimate Software’s patch on the Miami Heat’s new Nike jerseys was presented to the public Thursday, Sept. 21, 2017 at a press conference at AmericanAirlines Arena. mnavarro@miamiherald.com

One of South Florida’s most prominent technology companies is being acquired — at a price one expert sets as a record.

Weston-based Ultimate Software, which specializes in human resources software, announced early Monday that an investor group led by San Francisco-based private equity firm Hellman and Friedman had purchased the company for $11 billion.

Ultimate, currently traded on the NASDAQ exchange, will be taken private.

Jeff Richards, a managing partner at California-based venture capital firm GGV Capital, tweeted that the announcement represents the largest acquisition of a pure enterprise software company, and the largest software-as-a-service transaction, on record.

In an email, Richards expanded on the point.

“It’s huge validation for a point we and others ([former AOL CEO] Steve Case) have been making — Tech is expanding well beyond Silicon Valley,” he wrote.

“You can build a $11B software company in Florida (Ultimate), Utah ($8B/Qualtrics), etc. With the rise of [Amazon Web Services] and developer talent around the world, we expect this trend to continue.”

He said it is likely the windfall from the purchase could spur future local investment in tech.

“Any time you have a mega exit like this, it spawns an ecosystem,” he wrote. “Smart and talented people who are part of the Ultimate team will now have the financial resources and know-how to start and fund new companies (this is the magic formula of Silicon Valley)...It should remain a thriving, going concern and potentially create even more wealth for employees in the region.”

The purchase price of $331.50 per share represents a 32-percent premium over Ultimate’s average trading price over the past 30 days. Ultimate’s largest shareholders comprise large asset management groups like Fidelity and BlackRock. CEO Scott Scherr and Ultimate’s existing senior management team will remain in place.

Ultimate currently employs approximately 1,650 in Weston and more than 5,000 employees total. A company spokesperson said it does not anticipate any changes to head count as a result of the acquisition.

“The transaction provides our stockholders with a substantial premium. Our decision was also made with the best interests of our 5,144 employees and our more than 5,600 customers at heart,” Scherr said in a statement.

Ultimate Software is the official jersey sponsor of the Miami Heat.

Rob Wile covers business, tech, and the economy in South Florida. He is a graduate of Northwestern’s Medill School of Journalism and Columbia University. He grew up in Chicago.
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