Enfusion (ENFN.N), a U.S. software provider for asset managers, is exploring options, including a possible sale, as it engages with investment bankers, according to sources familiar with the situation. The Chicago-based company, valued at $1.1 billion, began interviewing investment banks recently after attracting interest from potential buyers, including private equity firms, with sources requesting anonymity due to the confidential nature of the discussions.
Enfusion hasn’t initiated a sale process yet, and the company may choose to remain independent, the sources noted. Enfusion did not immediately respond to requests for comment. Following the news, the company’s shares surged as much as 19% before trading was briefly paused on Friday. This isn’t the first time Enfusion has considered a deal; Reuters reported last year that the company received acquisition interest from several potential buyers, including Francisco Partners, Vista Equity Partners, and Irenic Capital Management.
Enfusion, which primarily serves hedge funds, offers cloud-based portfolio management and risk systems to investment funds. The company has been working to attract larger funds and corporations with complex operations, as it has faced challenges in increasing revenue from its existing customer base. Since its IPO in 2021, Enfusion’s shares have dropped over 50% in value, and as of yesterday’s close, they were down about 12% for the year, underperforming the S&P 500 Application Software index, which has remained relatively stable, amid concerns about customer spending cuts.
The company posted a year-on-year revenue increase of 16%, reaching $49.5 million in its latest quarter, but fell short of market expectations. Investment firms FTV Management Company and ICONIQ Capital hold about a 50% stake in Enfusion. Earlier this year, Spruce Point Management took a short position against Enfusion, expressing doubts about the company’s status as a high-quality software provider and raising concerns that its revenue might be “at high risk of misstatement.”
Author: shadjavist
Humble gentleman who never believes in impossibility
