The business said it has entered into a definitive agreement under which HGGC will acquire all outstanding shares of Monotype common stock for $19.85 (£16.30) per share in cash, representing an aggregate equity value of approximately $825m.
The transaction, which was unanimously approved by Monotype’s board of directors, is expected to close in Q4 2019 and the business said it expects to remain headquarted in Woburn, Massachusetts following the completion of the deal.
Pamela Lenehan, chair of the Monotype board of directors, said: “We are pleased to reach this agreement with HGGC, which enables our shareholders to realise immediate value at a significant premium for their shares. This transaction is clear recognition of the tremendous value and reputation that Monotype has built.”
President and chief executive Scott Landers added: “Over the last several years, Monotype has strategically shifted its business from primarily serving a small group of OEM manufacturers to one that addresses the needs of thousands of brands and millions of creative professionals worldwide.
“As a private company, we will have the financial support and added flexibility to invest in ways that deliver more value and improve the overall experience for our customers.
“This transaction is a testament to our talented employees and their dedication to serving our customers, and we look forward to partnering with HGGC as we continue helping customers maximise their customer engagement in today’s digital, mobile and global landscape.”
David Chung, executive director at HGGC, said the private equity firm was “honoured to partner with Monotype, a proven innovator that is continually pushing the boundaries with next-generation font technology and creative customer-centric solutions”.
Following completion of the transaction, which is subject to various closing conditions, Monotype will become a privately-held company and shares of its common stock will no longer be listed on any public market.
HGGC principal Bill Conrad said that as a private company Monotype will be “well positioned to fully leverage its world-class intellectual property and design capabilities to generate growth”.
Founded in 1887, Monotype turned over $63.2m – an increase of 4% year-on-year – and achieved net income of $10.3m in the three-month period ended 30 June 2019.