UK tech startup Huddle is being sold to Turn/River, a San Francisco-based private equity firm.
According to Business Insider, the deal is estimated to be worth a reported $89m (£68m).
The news surfaced after Huddle, which produces enterprise collaboration software and has raised $89.2m from investors, published a now deleted blog post on Sunday naming Turn/River as a majority shareholder.
The following day, on Monday, Huddle sent a letter to its shareholders and employees stating that the San Francisco-based firm would be buying its shares under “drag along covenant” or “bring-along provision”, which stops minority shareholders from refusing to sell their shares if a buyer who wants total ownership of the company makes an offer to a majority shareholder.
According to the letter, Huddle’s early backers and some of its management are set to receive a payout as a result of the acquisition. However, current and former employees are not expected to profit from the deal but will receive £77 as a gesture of goodwill from Huddle.
A Huddle spokesman confirmed that the shareholder letter was genuine but declined to divulge additional details.
The news comes after Huddle reduced its workforce and its co-founders Alastair Mitchell and Andy McLoughlin were replaced by CEO Morten Brøgger in 2015.