KnowBe4 ($KNBE) Conflicted Merger, Equity Rollover Scheme, and Public Investor Losses Case

• $KNBE investors filed a claim against KnowBe4 for misleading shareholders about a rigged take-private merger that allowed insiders to cash out public investors while quietly rolling over nearly $800 million in equity to benefit themselves.

• After shareholders were forced out at $24.90 per share, well below internal valuations and suppressed bids, $KNBE was delisted in February 2023.

• $KNBE investors can join this case to be notified about potential recovery.

Case Details:

Between October 12, 2022, and February 1, 2023, KnowBe4 insiders pushed through a $4.6 billion sale to Vista Equity Partners, claiming it was the result of an “independent” process that maximized shareholder value. The proxy statement informed shareholders that the $24.90 price was fair and supported by a special committee and a fairness opinion from Morgan Stanley.

In reality, the sale process was heavily influenced by insiders—Vista, KKR, Elephant Partners, and founder Stu Sjouwerman—who stood to retain ownership through a secretive equity rollover worth nearly $800 million. They suppressed interest from competing bidders, misrepresented Morgan Stanley’s valuation range (which went as high as $37.52 per share), and structured the dual-class vote to guarantee approval regardless of common shareholder opposition.

Despite multiple red flags and clear conflicts, the merger was pushed through. KnowBe4 was delisted on February 1, 2023, leaving public shareholders cashed out far below fair value.

Based on these events, $KNBE investors filed a claim against KnowBe4, accusing the company of the following:

• It misled investors by falsely claiming the merger was fair and independent.

• It concealed the size and terms of the insider equity rollover.

• It manipulated voting power to push through a conflicted deal that harmed public shareholders.

Considering all the representations, investors believe KnowBe4 and its insiders rigged the deal to extract maximum value for themselves while shortchanging the public.