London-based global private equity firm Cinven is purchasing TaxAct in an all-cash deal worth $720 million. Upon completion of the sale, the firm will merge the tax preparation software business with Drake Software, another portfolio company in the same industry. The newly-formed holding company will represent a full-service tax preparation provider specializing in both professional tax preparation and consumer filing services.
Since 1998, TaxAct has been a popular provider of digital tax filing assistance software designed to help individuals prepare and file their taxes without the help of a human tax prep professional, serving more than 85 million individual filers to date. Its new partner, Drake Software, has been a go-to provider of professional tax preparation software for tax offices and accountants across the United States. Cinven made an undisclosed investment into Drake in 2021 to promote its growth, and this new deal is the apparent next step.
After the transaction closes, the two companies will continue to be operated as separate brands; Dom Morea will stay on as President and CEO of Drake Software, while Curtis Campbell will continue as President of TaxAct.