Freshworks acquires Device42 (D42 Parent, Inc.)

Freshworks acquired Device42 (D42 Parent, Inc.) for $230 million aggregate purchase price (announced; $215M cash + $15M equity rollover, plus up to $20M in retention RSUs). Total purchase consideration recorded at $238.1 million per the FY2024 10-K business combination note., a transaction completed in June 2024, structured as combination - cash plus equity rollover and assumed/converted stock options.

Device42 (D42 Parent, Inc.) operates in IT Service Management (ITSM) / IT Asset Management (ITAM), is based in United States. Device42 is an IT asset management company that provides comprehensive, continuously up-to-date views of assets across an organization's entire IT infrastructure - from mainframe to cloud. Freshworks acquired all outstanding equity of D42 Parent, Inc. through its wholly-owned subsidiary Doppler Merger Sub, Inc. The combination lets Freshworks offer a more comprehensive IT solution, pairing Device42's asset discovery and application dependency mapping with Freshworks' Freshservice ITSM platform.

Combined, the offerings deliver unified ITSM and ITAM capabilities including advanced asset discovery and application dependency mapping, enabling customers to anticipate risks better and resolve incidents faster - reinforcing Freshworks' position in the ITSM market against larger competitors.

Device42's asset discovery and application dependency mapping fill a capability gap in Freshworks' Freshservice ITSM suite, supporting Freshworks' move upmarket into mid-market and enterprise accounts where it competes with ServiceNow. Cross-sell of Device42 ITAM into the existing Freshservice installed base and higher enterprise win rates; the FY2024 10-K allocated $67.6M to customer relationships, $30.7M to developed technology, and $140.8M to goodwill. Folded into Freshworks' Freshservice IT Service Management product line. Freshworks CEO, earnings call: "We did do the Device42 acquisition. Didn't have a huge revenue installed base, and we actually were pretty open that we expect that installed base to have disruption to it because it was mainly through a partner competitor, and so we expect a lot of that to go away. The thesis of that buy was on cross-selling into our existing Freshservice installed base, but also higher win rates, specifically as we're moving up enterprise and we're competing more and more with ServiceNow, and so that one is playing out."

Advisory firms were not disclosed for this transaction.