MeridianLink Inc., which was started in 1998 by a Vietnamese refugee, is being sold for $2 billion.
The provider of software for small banks and credit unions last week announced that it has entered a definitive agreement to be acquired by global investment firm Centerbridge Partners L.P.
“Today’s announcement is a strong endorsement of our leading digital lending platform that serves nearly 2,000 community financial institutions and reporting agencies,” said MeridianLink President Larry Katz, who is assuming the additional role of chief executive from current CEO Nicolaas Vlok, effective Oct. 1.
“Together with Centerbridge, we will unlock the potential of this company by accelerating product innovation, harnessing the power of AI and data, and enhancing the delivery of exceptional customer experiences.”
MeridianLink will become a private company and no longer be listed on the New York Stock Exchange upon the deal closing. The company, which moved headquarters from Costa Mesa to Irvine in June, said that it will remain in Irvine. Officials declined to comment for this story due to the pending acquisition.
Shares shot up about 24% to $19.75 and a $1.5 billion market cap the day the acquisition was announced (NYSE: MLNK).
MeridianLink has an enterprise value of $2 billion, the companies said; the company has $463 million of long-term debt as of June 30, according to its quarterly results released on Aug. 11.
“As the pace of change across the finance and tech sectors continues to accelerate, MeridianLink is uniquely positioned to help financial institutions enhance their digital lending and credit reporting capabilities to expand and deepen client relationships, unlock the potential of data and AI, and drive their growth,” Centerbridge Senior Managing Director Jared Hendricks and Managing Director Ben Jaffe said in the statement announcing the deal.
Slowing Sales in Recent Years
The acquisition comes amid a recent period of slowing sales for the company.
While sales jumped about 75% from 2019 to 2021, they have notably slowed in recent years: from 7.6% growth in 2022 to a 4.2% increase in 2024. Analysts are predicting that MeridianLink’s sales will grow 4.1% this year to $329.2 million, followed by a 5.9% increase in 2026.
MeridianLink separately announced second quarter results last week.
The company reported revenue increased 8% to $84.6 million, surpassing the consensus estimate of $81.6 million.
Its adjusted EBITDA climbed 21% to $38.4 million, also topping estimates.
Revenue growth was primarily driven by subscription fees, which amounted to $71.1 million for the second quarter.
“Our second quarter results demonstrate strong execution in an environment that remains uncertain,” Vlok said in a statement.
In the earnings release, Katz said that the acquisition by Centerbridge will maximize shareholder value and accelerate product innovation.
Analyst firm Raymond James downgraded MeridianLink from Outperform to Market Perform, noting that the $2 billion sales price came slightly below their expectations for the business.
Under the terms of the deal, MeridianLink shareholders will receive $20.00 per share in cash for each share of common stock they own, a 26% premium over the closing price of MeridianLink shares as of Aug. 8.
The transaction is expected to close in the second half of 2025, according to the companies.
MeridianLink is being served by Centerview Partners LLC as lead financial advisor and Goodwin Procter LLP as legal advisor. Centerbridge is being served by Goldman Sachs & Co. LLC as financial advisor and Kirkland & Ellis as legal advisor.
Refugee from Vietnam
The company was co-founded by Tim Nguyen, who was born in Vietnam.
Nguyen’s family fled from the Communist regime in the early 1980s. They lived in a refugee camp for six years before eventually landing in Huntington Beach where his great-aunt sponsored his family.
After he graduated with a bachelor’s degree in information and computer science from the University of California, Irvine in 1998, he co-founded MeridanLink, which provides software to credit unions and small banks so that they can compete with larger financial entities.
Nguyen has served in various roles as the company’s CEO, president and chief strategy officer.
The company was acquired in 2018 by private equity firm Thoma Bravo, which still owns about 37.5% of the shares.
In 2019, Nguyen turned over the role of CEO to Vlok, and most recently became a strategic advisor to the company.
His journey from having to flee Vietnam at just 10 years old to co-founding a $1.5 billion software company, the seventh largest in Orange County, was one of six stories featured in last month’s Business Journal’s issue titled “Vietnam’s Loss, Orange County’s Gain,” commemorating the 50th anniversary of the fall of Saigon.
Nguyen also received a 2021 Innovator of the Year Award from the Business Journal.
MeridianLink went public in 2021 after raising an upsized $260 million initial public offering.
Shares soared higher than $28 with the company hovering around a $2 billion market cap.
Since then, shares have hovered under $20; at press time, they traded at $19.78 and a $1.4 billion market cap.
Moves HQ to Irvine
The company chose not to renew its lease for 19,838 square feet of space in Costa Mesa, which expired in May.
“Since we are a fully remote organization with teammates across the country, we now have a corporate address for shipping, storage and mail,” a company spokesperson told the Business Journal.
“For collaboration meetings, we are utilizing rental spaces across the country as needed.”
MeridianLink in 2020 transitioned into being a fully remote company and, as a result, reduced its local footprint in Costa Mesa by more than half.
It previously leased about 57,000 square feet of space at two properties along Sunflower Avenue, including a 38,202-square-foot warehouse owned by the company’s co-founder Nguyen.
Aerospace firm Safran Cabin recently signed a lease for one of MeridianLink’s former buildings, located at 1620 Sunflower Ave. The Paris-based company plans to relocate its U.S. headquarters from Huntington Beach to Costa Mesa by Sept. 2.
