Silver Lake in talks to acquire Workday in one of the largest software buyouts in history
Private equity has largely sat out large software take-privates this year, as concerns over artificial intelligence have made it harder to assess the future value of traditional software businesses. Against that backdrop, Silver…
Key takeaways
- Silver Lake is in talks to acquire cloud HR and financial software company Workday in what could rank among the largest software buyouts in history.
- News of the talks sent Workday shares nearly 18% higher on Thursday, with the stock closing at $206.45 and lifting its market cap to around $51.1 billion from about $43 billion.
- Workday reported fiscal 2025 revenue of $9.6 billion, up 13%, with operating cash flow of $2.9 billion, up 19%, though revenue growth slowed from 16% the prior year.
- The talks are ongoing and no deal is guaranteed, according to sources familiar with the matter.
- A Workday buyout would be a major test of private equity's appetite for traditional software as the industry reconfigures around AI, which has pressured enterprise software valuations.
Private equity has largely sat out large software take-privates this year, as concerns over artificial intelligence have made it harder to assess the future value of traditional software businesses. Against that backdrop, Silver Lake is in talks to acquire Workday, the cloud-based human resources and financial management software company, in what sources familiar with the matter describe as a potential deal that would rank among the largest software buyouts in history.
News of the talks sent Workday shares nearly 18% higher on Thursday. The Pleasanton, California-based company carried a market value of around $43 billion before news of the discussions became public; the stock closed at $206.45, lifting the market cap to around $51.1 billion.
AI pressure on enterprise software valuations
The timing reflects a sector-wide repricing. Before Thursday, Workday shares had fallen about 15% this year and sat more than 40% below their 2024 peak, as investors weighed whether cloud-based enterprise software could sustain growth rates against rapidly advancing AI. That uncertainty kept most private equity buyers away from large software deals. Hg Capital's agreement in January to take financial software maker OneStream private for around $6.4 billion was among the larger software buyouts announced this year. A Workday deal would be significantly larger.
The read-through extends further. Thoma Bravo's separate agreement to acquire payroll software provider Dayforce for around $12.3 billion signals that larger buyers are beginning to re-engage with enterprise software even as the AI question remains open.
Deal structure and Workday's financials
Silver Lake has a history of pulling in co-investors for large transactions. One person familiar with the matter said the firm could bring in additional partners, as it did when it teamed with Saudi Arabia's Public Investment Fund and Affinity Partners on its roughly $55 billion take-private of Electronic Arts last year.
Workday reported revenue of $9.6 billion in fiscal 2025, up 13%, with operating cash flow of $2.9 billion, up 19%. Revenue growth slowed from 16% the prior year. Founded in 2005 by former PeopleSoft executives Aneel Bhusri and David Duffield, Workday went public in 2012 and now serves more than 11,500 customers globally. Bhusri returned as chief executive in February, replacing Carl Eschenbach, as the company navigates growing pressure from AI on its core business.
The talks are ongoing and no deal is guaranteed, the sources said. A transaction at this scale would represent one of the biggest tests yet of private equity appetite for traditional software as the industry reconfigures around artificial intelligence.
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