12:07 PM EDT, 06/07/2024 (MT Newswires) -- PowerSchool ( PWSC ) said Friday that it agreed to be acquired and taken private by investment firm Bain Capital in a deal that values the education software provider at $5.6 billion.

Investors of PowerSchool ( PWSC ) will receive $22.80 per share in cash, reflecting a 37% premium to the company's closing price on May 7, the last trading day before media speculation surfaced about a potential deal. The company provides cloud-based software for K-12, or Kindergarten to grade 12, education.

The deal, which requires clearance from regulators, is expected to complete in the second half. Shareholders owning a majority of PowerSchool's ( PWSC ) voting stock have approved the transaction. Shares of the company edged up 0.2% in midday trading.

"With Bain Capital's support, PowerSchool ( PWSC ) will have access to additional resources and the flexibility to deliver even more growth and innovation," PowerSchool ( PWSC ) Chief Executive Hardeep Gulati said in a statement. The company will no longer trade publicly once the deal completes, but will remain a stand-alone entity.

Vista Equity Partners and Onex Partners will continue to hold minority investments in PowerSchool ( PWSC ). Onex currently has a 24.33% stake in the firm, while Vista Equity holds a 20.61% interest, according to Capital IQ data. Vista Equity acquired PowerSchool ( PWSC ) from Pearson in 2015 while Onex joined as an equal equity partner of PowerSchool ( PWSC ) in April 2018.

Last month, PowerSchool ( PWSC ) reported first-quarter adjusted earnings of $0.17 per share, down from $0.18 the year before. Revenue climbed 16% year over year to $185 million. At the time, the company said it expected revenue to be in a range of $786 million to $792 million for the 2024 full year.

"We believe there are significant opportunities to expand access to PowerSchool's ( PWSC ) best-in-class product suite around the world," said David Humphrey, a partner at Bain Capital.

Price: 22.41, Change: +0.04, Percent Change: +0.16