Our largest holding Software AG accepts buy out offer from Silver Lake Private Equity.

Note: Historic returns are no guarantee for future returns. The value of any investment may fall as well as rise. Today, Software AG accepted a 30 EUR per share buyout offer from existing owner Silverlake Private Equity, which will net us a ~50% one-day gain for our largest position. The company has rapidly been changing, moving away from a legacy database management business, towards a SaaS business model targeting the fast growing interface between IoT/Data/Analytics with a very strong and competitive product offering. As the shift in business model puts pressure on margins and top line revenue (company moves from licence to recurring), the company's recent unexpected decision to accelerate SaaS put a significant dent on the stock. Although painful in the short term, it is the right thing to do as there is currently an ongoing important land grab in the market. We subsequently increased our position from ~11% to ~14,5%, at around 20 EUR per share, making it our largest holding in the fund. Although we would have appreciated a longer term run with this company, we appreciate the one day gain, and expect the company to thrive in a private setting.