The GitHub competitor, GitLab, is reportedly looking for a company to acquire it. This development was reported by Reuters after people familiar with the matter divulged the information.
Sources told Reuters that GitLab is already working with investment bankers on a sale process and has attracted interest, including from the cloud monitoring firm Datadog. While this seems encouraging for GitLab, no sale has been confirmed yet and any deal that does go through is still several weeks away according to the anonymous sources.
What"s interesting is that Alphabet, the parent company of Google has a 22.2% stake in GitLab through its venture capital arm, CapitalG. If Datadog failed to buy GitLab then perhaps Alphabet may step up to acquire it, after all, rival GitHub is owned by Microsoft.
The company currently has a market value of about $8 billion, that"s more than the $7.5 billion that Microsoft paid for GitHub in 2018.
The news about GitLab seeking to be acquired comes against a backdrop of the tech sector making up the largest share of mergers and acquisitions during the first half of 2024. According to Reuters, companies are looking to expand their offerings due to AI and cloud computing and this is done through acquisitions of companies who work on products and services of interest.
The outlet also mentioned that GitLab"s shares are 16% down this year so far because investors are concerned that customers are reducing their spending. The stock underperformed the S&P 500 Application Software Index which has actually risen by 3%.
In more bad news for the company, its CEO and co-founder Sid Sijbrandij said in an earnings call last month that he would be undergoing cancer treatment for osteosarcoma, this is the second time he has been treated for this condition. He told investors that he would be focusing on making a full recovery alongside performing his duties as GitLab CEO.
Source: Reuters