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Kronos Prepping For Next Growth Phase

Written By: Predrag Jakovljevic
Published On: February 24 2014

Kronos recently announced that Blackstone and GIC would invest in the software company alongside original investors Hellman & Friedman and JMI Equity. Hellman & Friedman will remain the majority investor in the company even after this recapitalization of the company through a $750 million (USD) equity investment by funds managed by Blackstone and GIC.
 
As a bit of history, in 2007 H&F and JMI took Kronos private in a transaction valued at $1.8 billion (USD). Since then, Kronos has increased revenue 45 percent (approaching $1 billion [USD] in annual revenue) and earnings before interest, tax, depreciation, and amortization (EBITDA) 114 percent. Now, 7 years later, Kronos is valued at $4.5 billion (USD), and the vendor is adding investments from Blackstone and GIC to the mix.
 
The addition of new investors in Kronos should bring further global expertise, resources, and insight to the company. The new investment is expected to enable Kronos to accelerate the pace of innovation that has fueled its growth in recent years. There are no changes planned for executive leadership—Aron Ain will continue to lead the organization as chief executive officer (CEO). The transaction is expected to close in the first half of 2014.
 
Kronos’ original and majority investors have apparently gotten a great payback, and they want more. New order of business is: keep at it (the company’s current strategy, including acquisitions). It will be interesting to see whether and how Kronos pursues the link between the Internet of Things (IoT) and workforce management (WFM) in light of GE Healthcare recently acquiring API Healthcare.
 
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