Smartsheet gains after deal background shows another party considering cash/stock offer

Smartsheet (NYSE:SMAR) rose 1.1% after background in the company’s proxy filing for its planned $8.4 billion sale to Vista Equity Partners and Blackstone (BX) indicated another party was interested in a stock and cash bid.

The CEO of unidentified “Party I” contacted Smartsheet’s (SMAR) Chairman Michael Gregoire on Sept. 7 to discuss the company’s interest in a proposal to acquire the company for half cash and half stock, according to the proxy filing disclosed on Wednesday.

On Sept. 10, a representative of Party I said it wouldn’t be pursing a deal at the time, though it would consider a transaction after a definitive agreement was reached between Smartsheet and a third party.

Smartsheet (SMAR) announced on Sept. 24 a deal to sell itself to private equity firms Vista Equity and Blackstone (BX) for $56.50 a share.

The deal includes a 45-day go shop period that expires on Nov. 8. The transaction is expected to close in Q4 of Smartsheet’s (SMAR) fiscal year ending Jan. 31.

Analysts said after the Smartsheet (SMAR) deal was announced that there was a possibility it may see other bids, though it was unlikely. Amazon (AMZN), Google (GOOGL), Zoom (ZM) and Oracle (ORCL) are strategic buyers that may make sense for Smartsheet (SMAR), William Blair analyst Jake Roberge wrote in a note last month.

RBC analyst Rishi Jaluria wrote in a note on Wednesday that Party I candidates are likely Zoom Video or Dropbox (DBX).

“We would note ZM has expressed M&A as a key priority for its $7.5B cash pile,” Jaluria, who has a sector perform rating on Smartsheet wrote.

Zoom (ZM) didn’t immediately respond to Seeking Alpha email request for comment.