Permira funds to acquire $200m of LegalZoom equity

Permira funds is expected to acquire over £200m of online legal solutions provider through one of its subsidiaries.

The Permira funds aim to support LegalZoom’s continuous launch of new products and services that address an ever-widening set of customer needs while making them easier to use, the firm said.

US-based LegalZoom has helped over two million small businesses and individuals across all 50 states, Permira also said.

“LegalZoom is the clear leader in the huge untapped market for small business and family law,” said Dipan Patel, a principal at Permira.

“The company has strong brand recognition, a unique value proposition and a proven track record. We’ve been impressed by the team’s development of multiple successful subscription products, which, in less than four years, now represent more than 30% of revenue, growing in excess of 35% per year.

We are excited to back John Suh and his talented team at LegalZoom as they continue to lead this emerging industry.”

“The Permira funds are a fantastic partner for this next chapter of LegalZoom’s growth,” said John Suh, CEO of LegalZoom. “They share our passion for creating modern customer-centric legal solutions that help businesses and families save both time and money. They also have an unusual knack for helping industry leaders extend their market leadership.”

Under the terms of the transaction, a company backed by the Permira funds is expected to acquire more than $200 million of the outstanding equity of LegalZoom through a tender offer launched December 30, 2013.

LegalZoom’s management team will maintain ownership in the company, as will the company’s current largest shareholders, which include Polaris Venture Partners, Institutional Venture Partners, and Kleiner Perkins Caufield & Byers.

Following the close of the transaction, the company backed by the Permira funds will be LegalZoom’s largest shareholder and have the right to appoint a majority of the Board of Directors of the company, which will include Brian Ruder, partner at Permira, and Dipan Patel, principal at Permira.

The transaction is subject to customary regulatory approvals and closing conditions and is expected to close in the first quarter, the firm said.

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