Bridgepoint snaps up stake in MiQ from ECI Partners; KKR group cools on Ramsay Health Care

ECI invested initially in MiQ in 2017 and has realised a 6.1x return on the exit.

Good morning Eurohubsters, Craig McGlashan here with Tuesday’s Dealflow.

The dealmaking environment is starting to warm up again, with a deal in the marketing service sector involving Bridgepoint and ECI Partners. Elsewhere, a big potential trade looks to be off, while one asset manager is following a recent trend for expanding in Europe.

International expansion. Bridgepoint has purchased a stake in data-driven marketing service provider MiQ from ECI Partners. Bridgepoint is taking a majority stake in the company, a source familiar with the deal told PE Hub Europe. ECI invested initially in the target in 2017 and has realised a 6.1x return on the exit, according to the press release. All three companies are based in London.

MiQ was founded in London in 2010 by Gurman Hundal and Lee Puri and is a marketing specialist that works with companies to turn data into advertising campaigns. Bridgepoint will support MiQ to on its international expansion and client growth.

“It offers leading analytics solutions and platforms to companies everywhere and has achieved significant growth over the last few years,” said Charles Welham, director of Bridgepoint in London. “We look forward to providing the necessary expertise to help maximise the company’s market potential.”

“Since our investment the team have developed and executed an incredible North American expansion strategy, with over two thirds of group revenue now coming from the US,” said Tom Wrenn, partner at ECI. “Delivering a 6.1x return is representative of the fantastic partnership, and Gurman and Lee’s enthusiasm and ambition has made this investment a career highlight.

Downward pressure. A take-private deal by a KKR-led group for Ramsay Health Care, an Australian-headquartered healthcare services firm with a large presence in Europe, looks to be off after the private equity bidders declined to improve their offer.

Ramsay said in a statement today: “The latest correspondence received from the Consortium refers to its review of Ramsay’s FY22 result announcement and notes that it is not in a position to improve the terms of the Alternative Proposal. The correspondence also states that whilst the Consortium recognises that further engagement and access to further due diligence may provide some positive visibility, the information provided in the FY22 results implies that there is meaningful downward pressure on the valuation proposed under the Alternative Proposal.”

Ramsay’s share price on the Australian Securities Exchange closed at just over A$70 ($48.21; €47.53) on Monday but had fallen to just under A$63 at the time of writing, leaving a market cap of just over A$16 billion. Ramsay first announced in April that the KKR-led group had proposed to purchase Ramsay at a price of A$88.00 cash per share, valuing the company at around A$20.1 billion.

Ramsay released its financial results for the 12 months to the end of June on 26 August. EBITDA at the group level was A$1.8 billion, down nearly 11 percent. “Earnings were impacted by the ongoing disruption caused by the high numbers of covid cases in the community on activity levels, case mix and costs,” the company said.

The bidding group withdrew the indicative proposal in late August but “remained committed to an alternative structure”, according to Ramsay. Under the alternative proposal, Ramsay shareholders would have been able to elect to receive 100 percent cash consideration at the A$88.00 price for 5,000 of their shares, with the price for each additional share sold being A$78.20 in cash and approximately 0.22 shares in Ramsay Santé, the country’s French business that it co-owns with Crédit Agricole Assurances.

The Ramsay Board declined the alternative proposal on those terms in late August.

Ramsay is headquartered in Sydney and operates via four segments: Asia Pacific, UK, France and Nordics.

European push. Finally, we’ve been writing a lot lately about US private equity firms looking to expand in Europe and we got a little more on that front this morning after Ares Management announced that James Kim has joined the firm’s private equity group as a partner and head of European special opportunities.

Kim joins from Apollo Global Management and will be based in London.

“His extensive experience leading investment strategies and partnering with European businesses to deliver bespoke debt and non-control equity capital solutions will be an invaluable asset to our team,” said Scott Graves, partner, co-head of the Ares private equity group and head of special opportunities. “Given the significant opportunities we see in Europe, we believe our sourcing and execution capabilities will meaningfully benefit from an enhanced local presence.”

“We continue to see a significant opportunity for expansion of our private equity franchise in Europe,” said Matt Cwiertnia, partner and co-head of the Ares private equity group.

That’s it from me – speak to you tomorrow.