Silver Lake Partners plans to acquire Workday, which could become the largest acquisition in software industry history

Financial Associated Press, August 14 (Intern Editor Ye Ke / Editor Qi Ling) According to insiders, private equity giant Silver Lake Partners is in talks to acquire enterprise software company Workday. This news propelled Workday's stock price to surge nearly 18% on Thursday, marking its largest single-day gain since 2016.

In yesterday's late trading, the stock was suspended multiple times and closed at $206.45, with the company's market capitalization rising to approximately $51.1 billion. If the deal is finalized, it is expected to rank among the largest acquisitions in the global software industry.

Insiders stated that Silver Lake Partners has been negotiating with Workday over a potential deal for the past few months, and discussions are still ongoing, with no conclusion on whether an agreement will be reached. Silver Lake may also bring in other investors to jointly fund the acquisition. Both companies have not responded to requests for comment.

Before the media revealed the acquisition talks, Workday's market capitalization was about $43 billion, having fallen approximately 15% year-to-date and over 40% from its 2024 peak. Even with yesterday's significant rebound, it is still down about 8% overall.

The rapid development of artificial intelligence technology has led investors to reassess the growth prospects and business models of traditional enterprise software, putting continuous valuation pressure on software vendors like Workday.

Concerns about the impact of artificial intelligence on traditional software business models have made private equity firms more cautious about large software acquisitions, increasing the difficulty of evaluating companies' future growth prospects and values. So far this year, there have been relatively few privatization deals involving large software companies.

In January, Hg Capital agreed to acquire financial software company OneStream for approximately $6.4 billion. Previously, Thoma Bravo reached an agreement to acquire payroll management software provider Dayforce for about $12.3 billion. The potential size of the Workday deal would far exceed these two acquisitions and will serve as an important case to observe whether private equity capital will increase its investment in the software industry.

Silver Lake Partners has a long history of investing in technology and software companies, with investments including Dell Technologies, VMware, and Qualtrics. Last year, Silver Lake, in conjunction with the Saudi Public Investment Fund and Affinity Partners, completed a privatization deal for Electronic Arts (EA) valued at approximately $55 billion.

Workday was founded in 2005 by former PeopleSoft executives and went public in 2012, primarily providing cloud software for human resources, payroll management, finance, expense management, and planning to enterprises. The company has over 11,500 customers worldwide, including Netflix, US Bancorp, Johns Hopkins University, and Thomson Reuters.

In February of this year, co-founder Aneel Bhusri resumed the role of CEO of Workday, leading the company in addressing the challenges posed by artificial intelligence to traditional enterprise software In May of this year, Workday announced quarterly results that exceeded market expectations and stated that demand related to artificial intelligence is driving business growth, subsequently raising its performance forecast. Workday achieved revenue of $9.6 billion in fiscal year 2025, a year-on-year increase of 13%; operating cash flow reached $2.9 billion, a year-on-year increase of 19%, with its revenue growth rate lower than the 16% of fiscal year 2024.

(Financial Associated Press)