Deal of the week: Vista Equity sweetens SumTotal offer

Last week, Vista Equity Partners raised its bid for software developer SumTotal Systems for the third time in a month to $4.85 per share in cash, topping Accel-KKR’s latest bid by five cents.

Vista Equity said that if the breakup fee in SumTotal’s amended merger agreement with Accel-KKR is invalidated or reduced, the offer could go up to $4.95 a share. Vista Equity, which owns about 13% of SumTotal’s shares, said its latest offer valued the company at about $160 million.

Under the amended agreement, SumTotal was expected to continue to solicit alternative proposals until May 24, after PE Week’s deadline.

Early last week, Mountain View, Calif.-based SumTotal, a maker of employee management software, had amended its agreement with Accel-KKR and is required to pay a termination fee of $6.67 million if it accepts a superior proposal from another party.

Vista Equity and Accel-KKR have been engaged in a series of negotiations and amended buyout proposals to acquire SumTotal since Vista Equity offered $3.25 per share, or about $103 million in cash, for the company in April.

Tech-focused private equity firm Accel-KKR then offered $3.80 a share. Vista Equity, which has offices in Chicago and San Francisco, then upped its original proposal to $4.50 a share and then again to $4.75 per share. Accel-KKR raised its offer price to $4.80 a share, prompting Vista Equity to raise its bid again early last week. —Reuters