$6 billion Linux deal? SUSE IPO rumored

SUSE, the major European Linux company, may soon be spun out in a $6 billion IPO.

According to Bloomberg, EQT is planning an IPO for German Linux and enterprise software company SUSE. EQT is a Swedish-based private equity firm with €50 billion in raised capital. SUSE is the leading European Union (EU) Linux distributor. 

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Over the years, SUSE has changed owners several times. First, it was acquired by Novell in 2004. Then, Attachmate, with some Microsoft funding, bought Novell and SUSE in 2010. This was followed in 2014 when Micro Focus purchased Attachmate and SUSE was spun off as an independent division. Then, EQT purchased SUSE from Micro Focus for $2.5 billion in March 2019.

With an IPO of approximately $6 billion, EQT would do very well for itself in very little time.

SUSE has been very successful under EQT. SUSE's Q3 revenue, reported in September 2020, increased 14% year over year. This came despite the results of the COVID-19 pandemicon the global economy. Cloud ACV (Annual Contract Value) bookings continued to flourish with 81% growth, marking 14 consecutive quarters of year over year cloud ACV increase.

The German Linux power also reported a 35% increase year to date in customer deals worth more than $1 million; a 50% jump in ACV bookings year over year for SUSE Linux Enterprise Server (SLES) for SAP Applications; and 25% in US ACV bookings year over year. In short, SUSE is growing and it's been growing fast.

SUSE has also been growing.  In July, SUSE agreed to buy Rancher Labs in a major Kubernetes move.

Bloomberg states that the IPO talks are in a very preliminary stage. Nothing may yet come of these conversations. As for SUSE, a company representative said, "As a company, we are constantly exploring ways to grow. But as a matter of corporate policy, we do not comment on rumor or speculation in the market."

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