Cobra Holdings Inc.

Overview Key strengths Key risks Customer migration to the cloud, increasing financial regulation, and reliance on outsourcing should drive long term growth. We expect ongoing integration activities to result in revolver borrowings and negative free operating cash flow (FOCF) in 2022. Multiyear subscription-based revenue with high retention rates results in stable revenues. Aggressive debt-funded acquisition strategy likely keeps leverage elevated. Small revenue scale and EBITDA base could amplify performance risks. Since Clearlake Capital Group L.P.?s acquisition of the company in 2021, Cobra Holdings Inc. (dba Confluence) has acquired two sizable companies, doubling its EBITDA base. However, ongoing integration challenges led to lower-than-expected bookings at the end of 2021. We believe elevated investments, delays in cost savings, and rising interest rates

...We expect bookings to rebound this year but elevated integration costs to pressure liquidity. Since Clearlake Capital Group L.P.'s acquisition of the company in 2021, Cobra Holdings Inc. (dba Confluence) has acquired two sizable companies, doubling its EBITDA base. However, ongoing integration challenges led to lower-than-expected bookings at the end of 2021. We believe elevated investments, delays in cost savings, and rising interest rates are likely to result in weaker than expected revenue, EBITDA, and cash flow in 2022. Under our base case, we expect 1%-3% organic revenue growth and $15 million-$20 million in FOCF deficits....

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