OTPP expects single-digit growth for wealth management

Wealth management is the opening theme today, as Nina Lindholm speaks to OTPP’s Iñaki Echave about the firm’s pursuit of Seven Investment Management.

We then switch to exits, where Investcorp has sold its majority stake in a design company and Cinven has exited an agri-tech business.

Turning to take-privates, we have the result of the shareholder vote on Accel-KKR portfolio company Basware’s move for accounts payable software business Glantus.

We then have a completed deal by SK Capital Partners, before we finish on RBC Capital Markets hiring a sponsor coverage banker from Morgan Stanley.

Share the wealth

Wealth management has been an attractive sector for private equity money so this morning Nina Lindholm took a deeper look at the sector, as she spoke to Iñaki Echave, senior managing director at Ontario Teachers’ Pension Plan Board (OTPP), about the firm’s agreeing to take a majority stake in Seven Investment Management (7IM) from Caledonia Investments in early September.

The enterprise value was between £400 million ($502 million; €467 million) and £450 million, according to sources familiar with the matter.

IM is a wealth and investment manager with around £21 billion of assets. The company has headquarters in London and Edinburgh.

The industry has several tailwinds, according to Echave. These include asset appreciation, in line with longer-term trends in capital markets, and volume, supported by pension reforms.

“Independent advisers are getting more interest, which was proven during covid too,” Echave added. “Governments want people to save as the demographics get older. All of this is likely to drive single-digit growth in the industry.”

For M&A opportunities, “culture is very important, and there also needs to be an industrial rationale, for example cross selling”, said Echave. “We want to acquire businesses that provide additional business for our platform.”

“We want to continue investing in more advisers and people, so we can keep gaining a bigger slice of the pie by growing faster than others,” he added.

Check out the full article here.

Exit open

We spent quite a bit of time in yesterday’s Dealflow talking about some tentative signs that the exit market is loosening, including a sprinkling of active and announced IPOs.

UK chip manufacturer Arm, which is backed by SoftBank, has now been priced at the top of its $47-$51 target range, valuing the company at $52 billion.

We’ve also seen some exits via the private route this morning.

Investcorp has agreed to sell its majority stake in Georg Jensen, a Danish design brand, to Fiskars Group.

The transaction will be paid in cash and financed with debt. The enterprise value of €151.5 million represents EV/EBITDA (LTM) multiples of 9.5x on a stand-alone basis and 4.7x with cost synergies, net of integration costs, according to Fiskars.

Georg Jensen’s net sales were €158.1 million and EBIT was €14.9 million in 2022.

During its ownership period, Investcorp focused on product innovation, upgrading digital capabilities, expanding into new markets and adjacent categories, and realising operational efficiencies, according to a press statement.

Elsewhere in exits, Cinven has agreed to sell Planasa, an agri-tech company, to strategic buyer EW Group. Label Investments is also exiting its stake in the company.

Headquartered in Valtierra in Spain, Planasa is an agri-food company that breeds berry varieties, namely blueberries, raspberries, strawberries and blackberries. The company has six R&D centres in Europe, Mexico and the US, and has invested over €25 million in R&D over the last five years.

Since acquiring Planasa in January 2018, Cinven has worked with Planasa to develop and roll-out new berry varieties and invested in field digitalisation. In 2021, Planasa acquired Advanced Berry Breeding, a Dutch raspberry breeding group.

Approval

Glantus, an Irish accounts payable software company, look set to go back into private hands after just over two years as a public business after its shareholders voted to accept a take-private offer by Accel-KKR portfolio company Basware.

Basware, a Finnish invoice processing and accounts payable automation platform, is paying 33.42p per share for Glantus, which is headquartered in Dublin but listed on the AIM market of the London Stock Exchange via an IPO in May 2021.

You can read more on the offer, including the premium and justification from the Glantus board for accepting the offer, in our coverage from last month.

Completion

SK Capital Partners announced this morning that it has completed its acquisition of a majority stake in Ecopol, a developer and producer of water-soluble and biodegradable films and delivery systems.

You can read more about that deal from our coverage back in July.

People news

And finally, investment bank RBC Capital Markets has hired Rommie Bhutani as managing director, sponsor coverage.

Bhutani’s 25 years in financial services have mainly been in the European and global sponsor M&A and leveraged finance markets, according to a statement. He moves from Morgan Stanley, where he was managing director on the financial sponsor coverage team for 13 years.

He will be based in London and report to Graham Tufts, global co-head financial sponsor coverage.