v3.25.2
Business Combinations
 6 Months Ended
Jun. 30, 2025
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
Business Combinations Business Combinations
Acquisition of Enfusion Inc.
On April 21, 2025 (“Enfusion Acquisition Date”), the Company completed its previously announced acquisition of all outstanding stock of Enfusion, Inc (“Enfusion”), a leader in SaaS solutions for the investment management and hedge fund industry. The following table illustrates the computation of the estimated preliminary fair value of consideration transferred (in thousands):
Fair Value
Cash paid (1)
$760,499 
Fair value of Clearwater Common Stock issued (2)
598,648 
Fair value of converted Enfusion equity awards attributable to pre-combination service (3)
12,769 
Payment to terminate Enfusion’s tax receivable agreement (4)
30,000 
Total Merger Consideration 1,401,916 
Less: cash acquired22,864 
Total Merger Consideration, net of cash acquired$1,379,052 
(1) Represents the cash consideration paid, consisting of (i) $760 million calculated as a product of 130 million outstanding shares of Enfusion common stock and cash consideration of $5.85 per share, and (ii) $20 thousand to settle all options.
(2) Represents the fair value of 28,066,027 shares of Clearwater common stock estimated issued, calculated using the per share price of Clearwater common stock as of April 21, 2025 of $21.33. Each share of Enfusion common stock settled at closing was exchanged based on the Per Share Parent Stock Amount of 0.2159.
(3) Represents the fair value of Enfusion restricted stock units (“RSUs”) and performance RSUs attributable to pre-combination services. Each outstanding Enfusion RSU and Enfusion RSU that vested in whole or in part based on performance-based vesting conditions assumed by Clearwater was converted into a number of RSU awards denominated in shares of Clearwater common stock (“Clearwater RSUs”). 1.9 million Clearwater RSUs with a fair value of $41.3 million were issued, with $12.8 million attributable to pre-combination services. The fair value of Enfusion' equity awards after their conversion into Clearwater equity awards attributable to post-combination service will be recognized as expense over the post-combination service periods on a straight-line basis.
(4) Represents payment to terminate Enfusion's tax receivable agreement in connection with the acquisition.
We have accounted for this transaction as a business combination and allocated the fair value of the consideration to the tangible and intangible assets acquired as well as liabilities assumed, based on their estimated fair values. The excess of the purchase price over the preliminary fair values of these identifiable assets and liabilities was recorded as goodwill. The allocated preliminary fair value is summarized as follows (in thousands):
Fair Value
Accounts receivable, net $35,445 
Prepaid expenses and other current assets 3,191 
Property, equipment and software, net 9,035 
Operating lease right-of-use assets, net 16,211 
Deferred tax assets, net42,193 
Other non-current assets 1,625 
Intangible assets, net 450,000 
Goodwill852,717 
Accounts payable (1,059)
Accrued expenses and other current liabilities (11,420)
Operating lease liability, current portion (5,570)
Operating lease liability, less current portion(12,607)
Other long-term liabilities (709)
Total Merger Consideration for acquisition of business, net of cash acquired$1,379,052 
We expect to finalize the allocation of the purchase consideration as soon as practicable, pending finalization of taxes and any other adjustments related to acquired assets or liabilities, but no later than 12 months from the Enfusion Acquisition Date. Goodwill generated from this business combination is primarily attributable to the assembled workforce and expected post-acquisition synergies from integrating Enfusion into our business. The goodwill is expected to be partially deductible for income tax purposes.
The following table presents details of the preliminary fair values of identified intangible assets acquired (in thousands, except years):
Fair ValueEstimated Useful Life
Developed technology$400,000 7 years
Client relationships40,000 10 years
Trade name / Trademarks10,000 5 years
Total$450,000 
The identified intangible assets are measured at fair value as Level 3 in accordance with the fair value hierarchy.
Acquisition-related costs incurred were $3.4 million and $4.6 million during the three and six months ended June 30, 2025, respectively. There were no acquisition-related costs incurred during the three and six months ended June 30, 2024. These costs mainly consisted of professional fees and administrative costs and were expensed as incurred within "General and administrative" in our condensed consolidated statements of operations. The results of Enfusion’s operations have been included in our consolidated financial statements since the Enfusion Acquisition Date.
Acquisition of Beacon Platform Inc.
On April 30, 2025 (“Beacon Acquisition Date”), the Company completed its acquisition of all outstanding stock of Beacon Platform Inc. (“Beacon”), a next-generation leader for cross-asset class modeling and risk analytics for derivatives, private credit and debt, structured products and other alternative assets.
The following table illustrates the computation of the estimated preliminary fair value of consideration transferred.
Fair Value
Cash (1)
$351,355 
Fair value of Clearwater Common Stock issued (2)
175,585 
Fair value of Clearwater Common Stock to be issued (2)
3,122 
Fair value of converted Beacon equity awards attributable to pre-combination service (3)
1,911 
Total Merger Consideration 531,973 
Less: cash acquired44,208 
Total Merger Consideration, net of cash acquired$487,765 
(1) Represents the cash consideration paid and to be paid, calculated based on $7.86 per share.
(2) Represents fair value of 7,858,675 shares of Clearwater common stock, calculated using the per share price of Clearwater common stock as of April 30, 2025 of $22.74. Of the total, 7,721,401 shares of Clearwater common stock were issued as of June 30, 2025 and the remaining 137,274 shares of Clearwater common stock are expected to be paid within 12 months.
(3) Represents the fair value of Beacon options attributable to pre-combination services. Each outstanding and unvested Beacon option assumed by Clearwater was converted into a number of Clearwater RSUs. 0.2 million Clearwater RSUs with a fair value of $5.5 million were issued, with $1.9 million attributable to pre-combination services. The fair value of Beacon equity awards after their conversion into Clearwater equity awards attributable to post-combination service will be recognized as expense over the post-combination service periods on a straight-line basis.
We have accounted for this transaction as a business combination and allocated the fair value of the consideration to the tangible and intangible assets acquired as well as liabilities assumed, based on their estimated fair values. The excess of the purchase price over the preliminary fair values of these identifiable assets and liabilities was recorded as goodwill. The allocated preliminary fair value is summarized as follows (in thousands):
 Fair Value
Accounts receivable, net $16,769 
Prepaid expenses and other current assets 1,460 
Property, equipment and software, net 201 
Operating lease right-of-use assets, net 2,597 
Goodwill338,206 
Intangible assets, net 166,900 
Other assets 431 
Accounts payable (1,272)
Accrued expenses and other current liabilities (8,806)
Deferred revenue(12,347)
Operating lease liability, current portion (482)
Operating lease liability, less current portion(2,251)
Deferred tax liabilities, net(13,641)
Total Merger Consideration for acquisition of business, net of cash acquired$487,765 
We expect to finalize the allocation of the purchase consideration as soon as practicable, pending finalization of taxes and any other adjustments related to acquired assets or liabilities, but no later than 12 months from the Beacon Acquisition Date. Goodwill generated from this business combination is primarily attributable to the assembled workforce and expected post-acquisition synergies from integrating Beacon into our business. The goodwill is not expected to be deductible for income tax purposes.
The following table presents details of the preliminary fair values of identified intangible assets acquired (in thousands, except years):
Fair ValueEstimated Useful Life
Developed technology$130,000 8 years
Client relationships33,500 10 years
Trade name / Trademarks3,400 5 years
Total$166,900 
The identified intangible assets are measured at fair value as Level 3 in accordance with the fair value hierarchy.
Acquisition-related costs incurred were $2.4 million and $4.1 million during the three and six months ended June 30, 2025, respectively. There were no acquisition-related costs incurred during the three and six months ended June 30, 2024. These costs mainly consisted of professional fees and administrative costs and were expensed as incurred within "General and administrative" in our condensed consolidated statements of operations. The results of Beacon’s operations have been included in our consolidated financial statements since the Beacon Acquisition Date.
These acquisitions accelerate Clearwater’s vision of creating a unified, real-time portfolio view across all asset types in a single, cloud-native front-to-back platform solution for the investment management industry. Enfusion and Beacon collectively contributed revenues of $51.3 million and net losses of $18.1 million to our condensed consolidated statements of operations for the three and six months ended June 30, 2025.
Supplemental Pro Forma Financial Information (Unaudited)
The following unaudited pro forma financial information presents a summary of the condensed combined results of operations for each of the periods presented, as if the acquisition of Enfusion had occurred as of January 1, 2024, prepared in accordance with ASC 805. The information below reflects pro forma adjustments based on available information and certain assumptions that management believes are factual and supportable. The unaudited pro forma financial information includes adjustments primarily related to amortization of intangible assets acquired, stock-based compensation expense, interest expense for transaction financing, and acquisition-related costs along with the consequential tax effects. Additionally, pro forma information has not been presented for Beacon as disclosure is impracticable due to the unavailability of historical quarterly financial statements. The information for the six months ended June 30, 2025 does not include results of Beacon for comparability.
Six Months Ended June 30,
20252024
Revenue$367,354 $307,017 
Net loss$(44,775)$(88,657)
The unaudited pro forma financial information presented above is for informational purposes only and is not indicative of the consolidated results of operations of the combined business had the acquisition of Enfusion actually occurred as of January 1, 2024, or of the results of future operations of the combined business.