Hg, the Manager of HgCapital Trust plc (HGT) has announced that it has made an investment in Personal & Informatik AG (P&I), which it has acquired funds advised by Permira for an enterprise value of €2 billion. While the terms of the transaction have not been disclosed, HgCapital Trust plc will invest approximately £37.7 million in P&I, alongside other institutional clients of Hg, and Permira funds remain invested with a substantial minority stake. Hg describes Personal & Informatik as a leading provider of cloud-based HR software, headquartered in Germany.
Fourth transaction for Saturn 1
The purchase of the Personal & Informatik stake represents the 4th investment from the Hg Saturn 1 Fund, which had its first close in early 2018. Satrun 1 focuses on software businesses with enterprise values of more than £1 billion. Hg managed funds will become the majority shareholder in the business.
P&I represents the 6th company focused on HR software in Hg’s current portfolio, alongside Visma, IRIS, Access Group, Citation Group and Allocate Software. These 6 HR software companies currently total over €14 billion of enterprise value within the wider Hg portfolio of 33 software and services companies.
About Personal & Informatik
Founded in 1968, P&I is an international provider of cloud-based HR software solutions. Hg says that P&I’s scalable subscription-based platform exhibits characteristics that resonate with Hg Saturn’s core focus, with a broad, diversified and loyal customer base, and has delivered exceptional historical operating performance, with over 10 years of consistent revenue and EBITDA growth. Hg also says that P&I has significantly extended its R&D capabilities over the past few years, which includes the opening of a new R&D hub in Greece in 2017. As a result, P&I developed and successfully introduced an integrated Software-as-a-Service (SaaS) platform allowing HR tasks to be managed in the most modern, efficient and fastest manner, delivering strong value to its customers and a truly differentiated experience to its users. P&I’s new sales force structure has grown its customer base to more than 15,000 end customers, ranging from small- and medium-sized private businesses (SMB) to large enterprises and public sector organizations of all sizes, mainly in Germany, Switzerland and Austria (DACH region).
HgCaital Trust NAV impact
The announcement says that, based on the 30 September 2019 NAV, (including all announced transactions and the proceeds from the issues of equity in November 2019 and December 2019), following completion of this transaction HGT’s pro-forma NAV is expected to be £1,023.2 million (or 251.8 pence per share). This transaction would value HGT’s existing investment in P&I, through the Hg Genesis 7 Fund, and associated co-investment at £20.0 million.
HgCaital Trust liquidity and outstanding commitments
The announcement says that, following the transaction, HGT’s liquid resources available for future deployment (including all announced transactions, the interim dividend paid on 25 October 2019 and the issues of equity in November 2019 and December 2019) are estimated to be £125 million (12% of the pro-forma NAV of £1,023.2 million). In addition, the Company has access to an £80 million standby facility, which is currently undrawn. The investment will reduce the Company’s outstanding commitments to invest in Hg transactions over the next two years to approximately £269 million.