According to Reuters, software developer.$Gitlab (GTLB.US)$Considering a sale. The company's investors include Google's parent company Alphabet (GOOGL.US), which currently has a market cap of approximately 8 billion US dollars.
Original article link:reuters.com/mar...
GitLab's stock price rose more than 10% in pre-market trading on Wednesday, and as of press time, it rose 12.22% to $56.85.
Insiders revealed that GitLab is currently cooperating with investment bankers in the sale process, which has attracted the interest of peers, including cloud monitoring company $Datadog (DDOG.US)$Datadog's current market cap is approximately 44 billion USD.
Sources said that any deal will still take weeks to reach and has not yet been determined. Alphabet holds 22.2% voting shares of GitLab through its venture capital department.
As AI and cloud computing promotes corporate expansion of product range, the matchmaking of deals in the technology industry is accelerating. Alphabet is in deep negotiations to acquire cybersecurity start-up company Wiz for about 23 billion USD. Previously, Alphabet had considered acquiring marketing software company $HubSpot (HUBS.US)$.
According to data from Dealogic, the technology industry had the largest share in global M&A transactions in the first half of 2024, with a year-on-year increase of over 42%, to 327.2 billion USD.
GitLab's platform allows development, operation, and security teams to design and manage software using a single tool. As shown on its website, it has over 30 million registered users and more than half of Fortune 100 companies are using it.
Since its IPO in 2021, GitLab's stock has been traded in New York. Concerned about its customers cutting spending, its share price has fallen 16% year-to-date, underperforming the 3% increase in the S&P 500 application software index.
Although the company announced strong year-on-year revenue growth of 33%, reaching 0.1692 billion USD and achieving positive cash flow for the first time in the latest quarter, the company acknowledges that since its acquisition of competitor GitHub for 7.5 billion USD in 2018, its product pricing has faced resistance due to competition with Microsoft.
GitLab CEO and co-founder Sid Sijbrandij controls 45.51% of the company's voting shares through a dual stock ownership structure. In last month's quarterly earnings call, he stated that he will receive his second treatment for sarcoma (a type of cancer), and he had also received sarcoma treatment last year. He added that he is working to fully recover and will continue to perform his duties.