Thoma Bravo’s Pragmatic Move: Uniting ForgeRock and Ping Identity

Thoma Bravo Plans to Combine ForgeRock and Ping Identity to Compete with Larger Companies

Introduction

In a surprising move that has caught the attention of industry observers, Thoma Bravo, an investment firm specializing in cybersecurity companies, announced plans to combine ForgeRock and Ping Identity, two prominent identity and access management (IAM) providers. The merger aims to create a company that can better compete with larger players in the IAM space, such as Microsoft and Okta. Thoma Bravo has made a series of acquisitions in recent years, including Barracuda, Entrust, McAfee, Proofpoint, SonicWall, and Sophos. While the investment firm has not typically combined the companies it buys, analysts argue that the combination of ForgeRock and Ping Identity makes practical sense due to the strong overlap in their product offerings.

Background

Thoma Bravo acquired ForgeRock for $2.3 billion in October 2022, shortly after completing its acquisition of Ping Identity for $2.8 billion. Additionally, in the same year, Thoma Bravo acquired SailPoint, an identity and governance administration (IGA) provider, for $6.9 billion. The announcement of the merger between ForgeRock and Ping Identity clarifies the future of these two product lines, which has been a cause of concern for customers of both companies for nearly a year. During this time, Thoma Bravo was unable to discuss its plans for ForgeRock due to a U.S. Department of Justice inquiry triggered by the acquisition.

Leadership Changes

Under the newly combined company, Ping Identity founder and CEO Andre Durand will lead as the CEO. ForgeRock CEO Fran Rosch announced his departure on LinkedIn, expressing his intention to support Durand and the team during a short transition period. The two companies have different strengths despite the overlap in their product offerings. ForgeRock is known for its highly scalable IAM solutions and its ability to integrate IoT devices. On the other hand, Ping Identity is recognized for its identity federation capabilities and its decentralized identity program.

Significant Decisions Ahead

Analysts highlight that significant decisions need to be made regarding the future of each product within the newly merged company. This merger’s success hinges on the ability to navigate these decisions effectively. Thoma Bravo will need to balance the overlap in products and ensure that the merger yields not only a productive but also a profitable outcome. However, it should be noted that a definitive answer regarding the fate of each product is not expected immediately. Customers of both companies have been in a state of uncertainty for the past year, eagerly waiting to see how the merger will unfold.

Lessons from Past Mergers

Experts caution that mergers of this nature can result in a protracted period of uncertainty and challenges. The unexpected difficulties faced by Okta after its acquisition of CIAM provider Auth0 in 2021 serve as an example. It took Okta 18 months to align its operations following the merger, underestimating the efforts required to integrate the two companies successfully. Additionally, unlike Okta and Auth0, ForgeRock and Ping Identity are direct competitors, which could further complicate the integration process. The timeline for Thoma Bravo to allow the companies to make the merger work both productively and profitably remains uncertain.

Conclusion

The merger between ForgeRock and Ping Identity, facilitated by Thoma Bravo, is poised to create a company capable of competing with major IAM players in the industry. However, numerous decisions concerning the future of each product will need to be made, and the success of the merger may take time to materialize. Customers of both ForgeRock and Ping Identity can expect a period of continued uncertainty as the merged company works through the integration process. Past mergers in the industry serve as a reminder that mergers of this scale require careful planning and execution to realize their full potential. The industry will be watching closely to see how Thoma Bravo navigates the challenges and opportunities brought about by this merger.