SAN FRANCISCO (Reuters) - HGGC has agreed to take a majority stake in database software firm Idera, valuing the company at roughly $1.125 billion including debt, the private equity firm said in a statement.
Software that maintains databases, part of the broader enterprise technology market, has become a favorite of private equity firms looking for steady revenue streams.
Boston-based TA Associates, which previously controlled Idera, will keep a significant minority stake in the company, the statement said.
HGGC, TA Associates and company management will contribute equity of about $400 million to $450 million as part of the deal, while Jefferies will provide roughly $700 million in financing, according to sources familiar with the matter.
HGGC, based in Palo Alto, California, was co-founded by former National Football League's San Francisco 49ers star Steve Young.
Young said in a statement that HGGC is excited to become an investor in Idera since it has executed an "aggressive acquisition strategy" and "strong organic growth."
The investment includes a pending acquisition of an unnamed company that Idera has made in recent months.
Idera provides database software for businesses in a variety of industries from education to government and makes tools to help employees monitor and test databases. It competes with CA Inc (CA.O) and BMC Software, which is now private and owned by private equity firms Bain Capital and Golden Gate Capital.
TA Associates acquired the Houston, Texas based company for an undisclosed sum in 2014.
HGGC's previous investments include marketing technology firm Etouches, an automated marketing software company called Selligent and FPX, software that helps tech companies price their products. It closed an $1.84 billion fund last year, its third buyout fund to date.
William Blair advised Idera. HGGC was advised by Jefferies LLC and Kirkland & Ellis LLP.
Reporting by Liana B. Baker in San Francisco; Editing by Cynthia Osterman and David Gregorio