Freshworks Buys Device42 For $230 Mn Amid Top-Level Rejigs

SUMMARY

Freshworks said that the purchase price would be paid in the form of $215 Mn of cash and an equity rollover of $15 Mn

This comes on the back of Freshworks posting a consolidated net loss of $23.3 Mn in the first quarter ended March 31, 2024, registering a 45.3% decline year-on-year

Also in a fresh development, Freshworks’ chief executive officer Girish Mathrubootham has stepped down from his role, while the company’s president Dennis Woodside has been named as his successor effective May 1

Nasdaq-listed SaaS major Freshworks has entered into a pact to acquire Delaware Corporation’s Device42 for $230 Mn (approximately INR 1,919.7 Cr).

In an SEC filing, Freshworks said that the purchase price would be paid in the form of $215 Mn of cash and an equity rollover of $15 Mn. As a part of this acquisition, Device42 will operate as a wholly owned subsidiary of Freshworks but the employees will be retained within the company.

Device42 is a US-based company which offers tech support to companies for IT support, compliance and audit, asset management, etc.

The latest development comes on the back of Freshworks posting a consolidated net loss of $23.3 Mn in the first quarter ended March 31, 2024, registering a 45.3% decline year-on-year (YoY).

Meanwhile, the company’s total revenue jumped 20% to $165.1 Mn in Q1 2024 from $137.7 Mn posted in the corresponding quarter of the previous year.

This comes parallel to the change in leadership within the company.

In a major internal rejig, Freshworks’ chief executive officer Girish Mathrubootham has stepped down from his role, while the company’s president Dennis Woodside has been named as his successor effective May 1.

Mathrubootham will be redesignated as executive chairman. He will now allocate more time to the long-term product vision, innovation, and AI strategy.

Freshworks has been going through major internal changes lately.

The fresh development comes days after Freshworks’ India head Karthik Rajaram quit the startup to join software company Elastic.

In February this year, Freshworks’ chief revenue officer (CRO) Pradeep Rathinam resigned, while the company’s cofounder and chief technology officer (CTO) Shan Krishnaswamy bid adieu to the company in 2022 after a company-wide rejig.

Meanwhile, it recently roped in ex-Adobe executive Mika Yamamoto as its first chief customer and marketing officer (CCMO) and also appointed Johanna Jackman as the new Chief People Officer (CPO).

Founded in 2010 by Girish Mathrubootham and Shanmugam (Shan) Krishnasamy, Freshworks offers a suite of software for customer service and support, customer engagement and IT service management. The company went public in 2021.

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