Atlassian snaps up US software firm for $234 million

Getty – Atlassian cofounders Mike Cannon-Brookes and Scott Farquhar

Australian productivity software giant Atlassian has acquired American agile planning software provider AgileCraft for approximately $US166 million ($233.8 million).

The $US166 million deal, expected to close in April, will be paid in about $US154 million ($216.9 million) in cash, with the remainder to be paid in Atlassian restricted shares.

Atlassian said many of its customers, including AT&T and Nielsen, already use AgileCraft alongside Atlassian’s issue tracking application, Jira, in their engineering and IT teams.

“Many leaders are still making mission-critical decisions using their instincts and best guesses instead of data … With AgileCraft joining Atlassian, we believe we’re the best company to help executives align the work across their organisation – providing an all-encompassing view that connects strategy, work, and outcomes,” Scott Farquhar, co-founder and co-chief executive of Atlassian, said in a statement on Tuesday.

Founded in 2013 in Texas, AgileCraft creates agile software businesses can use to map strategic projects, identify risks and bottlenecks and more accurately measure return on investment. It supports business running the “agile” methodology, an incremental project management theory developed by tech companies now widely adopted across other industries.

“Organisations lack the ability to easily gather and distil information across siloed teams – making it extremely difficult to assess progress and measure success … We’re excited to be joining the Atlassian family to enable the new digital enterprise, which is able to connect teams and align strategy to outcomes,” Steve Elliott, AgileCraft founder and chief executive, said in a statement.

Founded in Sydney by Young Rich Listers Mike Cannon-Brookes and Scott Farquhar in Sydney in 2002, Atlassian’s software is now used by NASA, Lyft and Bank of America Merrill Lynch to oversee collaboration and productivity.

The co-founders were not available for comment on the acquisition announcement.

The deal is expected to add $US1 million $US2 million in revenue for Atlassian for financial year 2019, reduce its international financial reporting standards operating margin by approximately 1 per cent, and reduce its non-IFRS operating margin by approximately half a per cent, according to Atlassian.

The $US26.6 billion software behemoth’s revenue climbed 39 per cent year-on-year to $US299 million ($423.6 million) for the quarter to December 31.

Atlassian also advised it expected the acquisition to dilute its IFRS and non-IFRS operating margin in fiscal 2020, reflecting a reduction to fair value adjustments to acquired deferred revenue.

This article was originally published by the Australian Financial Review. Read the original here, or follow the AFR on on Facebook.

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