Adobe Systems Inc said on Monday it would buy e-commerce services provider Magento Commerce from private equity firm Permira for $1.68 billion in cash, its biggest deal in nearly a decade.
Magento is a cloud-based e-commerce service used by companies including Coca-Cola, Warner Brothers Music, Canon, and Nestle. Businesses use Magento and Shopify to handle the complexities of e-commerce and boost revenue.
Magento CEO Mark Lavelle will “continue to lead the Magento team as part of Adobe’s Digital Experience business” but will have Adobe executive veep and general manager Brad Rencher as his boss.
Magento, founded in 2007, was acquired for an undisclosed amount by eBay in 2011. A few months after eBay split with digital payment processing company PayPal in 2015, eBay sold its enterprise software unit, including Magento, to investors Sterling Partners and Permira Funds for $925 million. Last year, Magento raised $250 million from Chinese investment firm Hillhouse at a reported private valuation of $700 million.
The commerce platform will be part of Adobe’s Digital Experience business, rounding out its customer experience tools, which already include content creation, marketing, advertising and analytics.
Magento presently comes in two flavors: an open source version that developers can customize and build on, and a paid Commerce version that brings additional functionality, like tools for staging, loyalty program management, and managed cloud hosting. The CMS has historically had a vibrant community that contributed plugins to expand its capabilities.
The deal is expected to close in the third quarter.
