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HgCapital exits CSH stake for £110m

8 Mar 2013

software2_lrgEuropean private equity house HgCapital has exited its investment in Computer Software Holdings (CSH) by selling the British software business to Advanced Computer Software (ACS) for £110m.

The deal marks the firm’s third successful exit in the technology, media and telecoms (TMT) sector in the past three years.

The business was part of HgCapital’s purchase of Iris Software Group in 2011

The firm’s other recent deals in the sector included the sale of Nordic SME software provider Visma in 2010 and the sale of SiTel in 2011.

Together with the sale of Addison software in 2008, these four exits have averaged an IRR of 37 per cent. Their value has been grown by £970m with HgCapital returning £482m to clients.

Jonathan Boyes, director in HgCapital’s TMT team, said, “The successful sale of CSH is further evidence of the success of our focused TMT investment strategy and our ability to work with strong management teams to build great businesses.

“We remain very confident in the long term outlook for the sector and our ability to create value through our dedicated sector expertise.”

HgCapital invests in the TMT sector from two funds. The Hg6 buyout fund targets businesses with an enterprise value of over €100m, while HgCapital Mercury Fund is focused on smaller buyouts.

The firm’s HgCapital Trust also released its full year results today. The report showed that the listed vehicle saw its NAV per share surge 15.3 per cent to 1,227.1 pence in 2012 compared with the previous year.

The current NAV stands at 1,255.4 pence.

It said it was “selectively cautious” on new investments, having deployed £38m during the year including three new buyout investments.

Earlier this year it was reported that HgCapital was among a handful of private equity firms in the race to acquire German insulation business Armacell.

Other suitors include Charterhouse and Pamplona, while Goldman Sachs Private Equity and Equistone Partners are believed to have dropped out of the bidding process.

Last month HgCapital sold UK-based wind farm RidgeWind to renewables developer Blue Energy £250m.

Back in October last year the firm completed a majority investment in UK online marketplace Valueworks.

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