Inflexion sells Phenna Group stake to Oakley Capital

The deal values Phenna Group at over £1bn and market sources said it provides a more than 5.5x return for Inflexion.

  • Phenna undertook 23 acquisitions following the minority investment from Inflexion in February 2021
  • It is the first exit by Inflexion’s Partnership Capital II fund and the 10th exit announced by the firm in 2022
  • Phenna is a group of specialist businesses focused on the testing, inspection, certification and compliance sector

Inflexion announced on Tuesday that it has agreed to sell its minority investment in Phenna Group to Oakley Capital in a deal that values Phenna at over £1 billion ($1.1 billion; €1.1 billion).

Market sources told PE Hub Europe that the deal represents a more than 5.5x return for Inflexion and is the third exit with an enterprise value of £1 billion or more from the firm’s partnership capital strategy. The strategy, now in its second vintage, is to buy minority equity stakes between 15 percent to 50 percent. Inflexion has been busy in the business services sector, having realised investments in companies such as Alcumus, British Engineering Services and K2 Partnering Solutions.

Phenna is a Nottingham-based group of specialist businesses focused on the testing, inspection, certification and compliance sector. Inflexion made a minority investment in the group in February 2021 and the group has since gone on to complete 23 acquisitions across six countries.

The 18 month long partnership has seen Phenna’s EBITDA more than double and its headcount triple.

“Phenna’s leadership team created an excellent platform to create a global leader,” said Simon Turner, managing partner at Inflexion. “Our significant sector expertise gained from other investments in the sector helped us to recognise the potential they could achieve, while our M&A experience served their ambition well. We’re delighted to have accelerated their journey and wish them all the best in the years to come.”

London-headquartered Inflexion is a middle-market private equity firm that backs majority and minority investments. It typically looks to invest between £10 million to £400 million in equity in each deal. It was founded in 1999 and has £7.1 billion in assets under management.

“Inflexion’s Partnership Capital minority offering combined with the firm’s impressive experience in similar businesses made them the perfect partner,” said Paul Barry, founder and CEO of Phenna. “Their knowledge of our sector and support in accelerating our M&A journey exceeded my expectations and I’d like to thank them for all their support.”

The buyer, Oakley Capital, was founded in 2002 and is headquartered in London. It is a private equity firm that invests across three core sectors – technology, consumer, and education.