Email security provider Zix Corp. entered into a definitive agreement to acquire cloud-based cybersecurity services provider AppRiver LLC for $275 million in cash. In conjunction with the deal, technology-focused private equity firm True Wind Capital Management LP will invest $100 million in convertible preferred equity in Zix, and two True Wind executives will join Zix's board.
Under terms of agreement with True Wind Capital, Zix will issue an aggregate of $100 million of shares of its convertible preferred stock at a price of $1,000 per share. True Wind Capital founding partner James Greene Jr. and Principal Brandon Van Buren will become Zix directors, expanding the company's board to eight directors.
Zix received a commitment letter from SunTrust Bank and KeyBanc Capital Markets with regard to a new five-year $175 million term loan and a $25 million revolving credit facility, which is expected to close with the completion of the AppRiver acquisition.
RBC Capital Markets LLC acted as lead financial adviser to Zix, with Baker Botts LLP as legal adviser to the company. Evercore served as lead financial adviser to AppRiver, with DCS Advisory as co-financial adviser and Kirkland & Ellis LLP as legal adviser. PJT Partners is financial adviser to True Wind, with Simpson Thacher & Bartlett LLP as legal adviser.
The transaction is subject to customary working capital adjustments and expense-sharing arrangements.