Pictet: rising funding costs ‘not a game changer’ for PE; Graphite Capital exits YSC Consulting

Genstar Capital’s Apex Group wraps up purchase of Sanne.

Happy Friday Eurohubsters, Craig McGlashan here with the Dealflow.

I always like to end the week on a positive note, so I was pretty glad to see a bit of research from Pictet Wealth Management about whether rising bond yields were going to cause a headache for private equity firms. Pictet’s answer? “So far, so good.”

Sovereign performance. The piece by Jacques Henry, head of equities, says that the yield paid for buyout debt “has always been fairly high”. That means that “while the recent increase in funding costs is not positive for buyouts’ performance, it is not a game changer either”.

The report added that Pictet expects the average interest rate to fund buyouts to converge towards the long-term average of 6.3%, only slightly above its current level of 6%.

In the biz. My colleague David Wansboro has reported a couple of deals that are of interest from two different angles, as both involve companies that serve the private equity industry.

First up, Graphite Capital has sold YSC Consulting to Accenture.

YSC Consulting is a London-based advisory and leadership consultancy that aims to help businesses align leadership strategies with their business goals. YSC Consulting has been a partner to 45% of the FTSE 100 and serves more than 40% of the largest private equity firms globally with services tailored to private equity funds and their portfolio companies.

“Leaders must meet new expectations to win the hearts and minds of employees and customers in a rapidly changing world,” said Christie Smith, global lead of talent and organisation and human potential at Dublin-based Accenture. “Successful business leaders thrive through the application of meaningful purpose and the use of technology to lead with accuracy, speed, empathy, and transparency. It’s at the cross-section of these values where Accenture and YSC Consulting truly align. We look forward to coming together and helping clients maximise their impact and carve a successful future steered by modern leadership.”

New locations. Genstar Capital portfolio company Apex Group has completed the purchase of Sanne Group, a global provider of alternative asset and corporate services.

The close of the Sanne acquisition brings an additional 2,500 people into Apex Group and adds six locations in Denmark, Japan, Serbia, South Africa, Spain and Sweden. Apex Group now operates from over 80 offices in more than 40 markets across the world, employing over 10,000 people.

The addition of Sanne adds further product depth and experience in serving alternative investment firms as well as bringing an expanded geographic footprint. Sanne has a presence in the US, Europe, Africa and APAC. This deal is the largest of 31 completed global acquisitions by Apex Group.

“With today’s announcement we have reached an inflection point in Apex Group’s story, as we become one of the largest providers in our space,” said Peter Hughes, founder and CEO of Apex Group. “Our M&A strategy is not simply about growth, it’s about expanding our capabilities and experience to be the best possible service partner to our clients. Combined, our global team increases to more than 10,000 people, across over 80 offices and nearly $3trn in assets with a premium book of clients. Bringing Sanne into the group enables us to offer increased product depth, and a wider geographic footprint.”

The deal for Sanne was previously reported here by PE Hub back in August 2021.

A new lawn. Finally, my colleague Aaron Weitzman over at PE Hub in the US has made me very jealous by reporting on Huron Capital’s majority investment in ExperiGreen Lawn Care, a Mishawaka, Indiana, company providing a variety of services, including seeding and soil amendment, to residential customers.

You might ask why that’s made me jealous. Well, it’s being widely reported here in London that the authorities are about to declare a drought. The effect of that is most obvious as I look out my window to where there was once a lawn and there is now a yellow patch of dead grass.

But if you want to know more about ExperiGreen Lawn Care and Huron Capital’s plans for it, then you can read Aaron’s piece here.

That’s all from us – have a great weekend and I’ll see you again on Monday.