TransPerfect Acquires Virtual Data Room Company Sterling Technology

TransPerfect buys VDR Sterling

On August 29, 2022, TransPerfect announced its acquisition of Sterling Technology, a provider of virtual data room (VDR) solutions based in the UK.

VDR solutions provide a highly-secure environment for content to be shared, most commonly to allow various parties to collaborate on the sensitive documents required for corporate dealmaking — a high-stakes activity usually shrouded in secrecy.

Although the terms of the transaction were undisclosed, TransPerfect CEO Phil Shawe told Slator that the “the valuation reflected Sterling’s position as a successful business providing a SaaS software solution.”

Likewise, TransPerfect declined to share revenue figures for Sterling. However, UK regulatory filings suggest that Sterling generates less than GBP 10.2m (USD 12m) in annual revenue.

Asked about the origins of the deal, Shawe said that Sterling had engaged an adviser to facilitate a sale and that “TransPerfect was invited to participate in the sale process,” which he described as a “competitive bidding process.”

The CEO of Sterling, Geoff Keating, will continue to lead Sterling Technology and will join TransPerfect’s senior management team. “Decisions related to specific technical integration and roadmap will be driven by Geoff and his team,” Shawe said.

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VDR and Language Services

Sterling is not TransPerfect’s first VDR acquisition; The Super Agency acquired Deal Interactive and incorporated it into their Legal Solutions offering in 2007. TransPerfect also owns proprietary VDR technology, called TransCEND, which the company will continue to offer.

Granted, VDR may not initially appear to be the most obvious area for a language service provider (LSP) to expand into, but with many corporate transactions (e.g., M&A) involving companies and stakeholders based in different countries, there is a clear crossover with translation services. (We highlighted the importance of the VDR market for LSPs in this article from as far back as 2016.)

More specifically, there is a long relationship between the world of financial printing, VDRs, and language services. For example, Toppan Merrill, which shares a parent company with LSP Toppan Digital Language, offers VDRs as part of its range of legal and financial printing services. Sterling itself was originally part of Sterling Financial Printing before it was separated in 2018.

Discussing the rationale behind the Sterling acquisition, Shawe told Slator that the use cases for VDR, and indeed Sterling’s technology, are broad. From the most active users of VDR such as “advisory, finance, and legal, Sterling’s VDR products are used in a number of corporate fields such as life sciences and real estate,” he said.

Shawe further explained: “We believe the addition of Sterling to our product mix is a potential game changer for us with respect to proactively addressing the VDR market. Of course, Sterling customers will have streamlined access to any TransPerfect services they wish to engage — and, reciprocally, we believe many TransPerfect customers stand to benefit from Sterling’s best-in-class VDR technology product and white-glove customer support.”

TransPerfect was advised by CDX Advisors as well as Baker Botts and Simons Muirhead Burton for Legal, while Sterling was represented by RSM UK and Ward Hadaway.