Microsoft Cloud Provider AvePoint Going Public Via Apex Technology SPAC

Leading Microsoft Corporation MSFT Cloud partner AvePoint is set to go public with a SPAC deal announced Monday.

The SPAC Deal: AvePoint will go public via Apex Technology Acquisition Corporation APXT. The deal values the company at $2 billion.

AvePoint co-founder and CEO Dr. Tiaryi Jiang and co-founder Kai Gong will remain with the company. AvePoint is expected to trade under the symbol AVPT when the deal is closed in the first quarter of 2021.

Apex Technology shareholders will own 17.6% of the new company.

About AvePoint: AvePoint sells directly to large and mid-market enterprises. The largest Microsoft 365 data management solutions provider is AvePoint.

The company has over 7 million cloud users from Microsoft. The customer base includes around 25% of the Fortune 500 companies.

Related Link: Microsoft Analysts: Q1 Shows Payoff From Cloud Shift, Azure Narrowing The Gap With AWS

Microsoft Partner: Microsoft’s cloud revenue continues to grow, with a 28% market share in the cloud market, according to IDC.

“The impact of Covid-19 and the growth of Microsoft’s cloud solutions, including Microsoft 365 and Microsoft Teams, have accelerated demands for our products. We have achieved eight quarters of impressive growth,” said AvePoint CEO Dr. Jiang.

Microsoft holds 13% share in the IaaS market, 11% in SaaS and 28% of productivity and collaboration. In the last 12 months, Microsoft Cloud revenue was $48.4 billion.

“We bridge the gap between what Microsoft Cloud offers and what the enterprise requires,” AvePoint said in the release.

Growth Ahead: AvePoint believes it has an addressable market size of $33 billion by 2022.

AvePoint’s 7 million customers represent a 3% share of Microsoft’s 250 million 365 users. AvePoint believes it can get to 10% share and Microsoft will hit 500 million users in the future, good for 50 million AvePoint future customers.

Of 212 public software companies, AvePoint joins a select group that has revenue of $150 million in 2020, year-over-year revenue growth of 25% or more and EBIT margins of 10% or more.

The five companies in the group are Atlassian Corporation TEAM, RingCentral RNG, ServiceNow NOW, ZoomInfo Technologies ZI and Zoom Video Communications ZM.

Each of the five companies in the select group are up more than 80% in 2020, with ZoomInfo seeing a strong 2020 IPO and Zoom Video up more than 500% on the year.

Financials: AvePoint is estimating revenue to grow 26% year-over-year to $148 million for fiscal 2020.

The company is forecasting revenue to hit $193 million and $257 million for fiscal 2021 and fiscal 2022, respectively. AvePoint is increasing its recurring revenue, providing predictable forecasting for its financial estimates.

About Apex Technology: Apex Technology is led by former Oracle Corporation ORCL CFO Jeff Epstein and Brad Koenig, the former Head of Technology Investment Banking at Goldman Sachs GS.

Epstein helped Oracle complete over 20 acquisitions including the $8.5 billion purchase of BEA Systems and the $7.4 billion acquisition of Sun Microsystems.

Koenig helped on 42 technology IPOs in 1999 that raised $9.6 billion. He was also part of the team that brought Alphabet Inc GOOGGOOGL to market in a $1.7 billion IPO.

Price Action: Apex Technology shares are up 3% to $10.45.

Posted In: AvePointMicrosoft 365Microsoft cloudSAASSPACSPACsM&ANewsSmall CapTechTrading Ideas

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