Upland Software Acquires Kapost, Raises Guidance

Accretive Acquisition Adds $15 Million in Annualized Revenues, Strong Customer Base, and Robust Content Operations Solution for Sales and Marketing

Upland Software, Inc., a leader in cloud-based enterprise work management software, has acquired Kapost, a leading content operations platform provider for sales and marketing. Kapost is an important addition to Upland’s Enterprise Sales Enablement and Customer Experience Management (CXM) solution suites. The acquisition adds approximately $15 million in annualized revenues and will be immediately accretive to Upland’s Adjusted EBITDA per share.

“Moreover, this transaction is immediately accretive to Adjusted EBITDA per share and takes Upland to a $220 million annualized revenue run rate. Our acquisition pipeline is robust, and we are actively pursuing additional opportunities to build out our solution suites.”

“Kapost brings an established enterprise customer base, experienced team, and sophisticated content operations platform to our sales and marketing solutions,” said Jack McDonald, chairman and CEO of Upland Software. “Moreover, this transaction is immediately accretive to Adjusted EBITDA per share and takes Upland to a $220 million annualized revenue run rate. Our acquisition pipeline is robust, and we are actively pursuing additional opportunities to build out our solution suites.”

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Kapost’s cloud-based content operations platform unites revenue teams to speak in one voice across the customer journey by streamlining the content development process at scale. The platform’s open architecture, robust set of APIs, and deep collaboration capabilities help organizations better orchestrate all stages of content planning, production, and distribution. Advanced analytics enable organizations to pinpoint hidden gaps in their content strategy, track content performance, and measure ROI.

“We are thrilled to welcome Kapost’s customers and team members to Upland,” said Sean Nathaniel, Upland’s chief technology officer and executive vice president of Workflow Automation Solutions. “Kapost’s powerful technology and built-in artificial intelligence adds advanced end-to-end content operations capability to our enterprise sales and marketing solutions, allowing complex sales and marketing organizations to boost the impact, relevance, and return on investment of their content.”

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The purchase price paid for Kapost was $45.0 million in cash at closing, and a $5.0 million cash holdback payable in 12 months (subject to indemnification claims). Upland expects the acquisition to generate annual revenue of approximately $15.0 million, of which $13.5 million is recurring, subject to reductions for a deferred revenue discount as a result of GAAP purchase accounting, estimated as $2.2 million for the remainder of 2019. The acquisition is within Upland’s target price range of 5-8x pro forma Adjusted EBITDA and will generate at least $7.0 million in Adjusted EBITDA annually once fully integrated. The acquisition will be immediately accretive to Upland’s Adjusted EBITDA per share.

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