UPDATED. We’ve got a series of deals to report this morning across a range of sectors, involving PSG Equity, Investindustrial, Bridgepoint and Main Capital Partners (plus more if you check the Deals section further down the newsletter).
So what’s the theme? Well, it’s the fact that they’re all platform investments. Last year we spent a lot of time hearing about how the difficulties of the M&A environment – expensive debt, mismatched valuations and so on – meant that private equity firms were doubling down on portfolio companies via add-ons, bolt-ons and the like.
We’re featuring some data today that supports that picture from the Centre for Private Equity and MBO Research. But with so many platform investments landing in our inbox right now, it’s hard not to get a sense that 2024 could be a turning point for dealmaking.
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First, let’s get stuck into the new deals.
Visit Group provides commerce software to companies including mountain resorts, ferry operators, amusement parks and activity vendors.
PSG will acquire shares from Standout Capital and other minority shareholders while the founder and management will remain significant holders.
PSG will support Visit Group to accelerate organic and inorganic growth across the region by broadening the range of services offered to its customers, according to a release.
“We’ve been closely monitoring this space for some time and have been impressed by Visit Group’s unique value proposition across the Nordics, underpinned by strong network effects which help enhance connectivity and synergies among all stakeholders in the hospitality ecosystem,” said Edward Hughes, managing director at PSG.
The transaction is PSG’s first platform investment in Sweden and Norway and its 24th in Europe.
Fassi provides truck-mounted lifting equipment including knuckle-boom cranes, tippers and hydraulic hooklifts, focusing on a number of end-markets such as forestry and environmental and construction. It generated sales of over €470 million in 2023.
Elevation Investment Opportunities, an independently managed investment subsidiary of Investindustrial VII, is making the deal.
Investindustrial plans to grow Fassi by accelerating its international expansion, product diversification and supply chain integration, according to a release.
Skin in the game
Bridgepoint’s RoC deal was for around $500 million, PE Hub Europe understands
Gryphon acquired RoC from Johnson & Johnson and established it as an independent business in 2020.
Since then, RoC has seen organic growth, supported by a revival of the brand’s positioning and a growing consumer trend towards clinically proven skincare products, according to a release. RoC’s revenue has grown by 70 percent since 2020.
“The company’s unique, clinically proven products for ageing skin conditions are a highly appealing customer proposition with significant growth opportunities,” said Fabrice Turcq, partner at Bridgepoint. “With Bridgepoint’s support, RoC is poised to accelerate growth in Europe and beyond, strengthen its online presence and expand its product offering.”
Bridgepoint plans to support RoC in accelerating its growth in its heritage European markets and in France in particular, the release said.
(Note: Bridgepoint owns PEI Group, the publisher of PE Hub Europe.)
Main Capital Partners has made its third platform investment of the year, taking a majority investment in Buchner, a software provider for general therapists in Germany.
Kiel, Germany-based Buchner has around 160 employees and caters for around 45,000 physiotherapists, occupational therapists, speech therapists, podiatrists and other healthcare professionals. It helps therapists in digitising key processes in their practice management.
Main will support Buchner to expand its software business and accomplish the company’s plan of facilitating practice organisation and freeing up more resources for therapy, according to a release.
“Buchner is a household name for general therapists in Germany and well-positioned to benefit significantly from the ongoing digitisation,” said Dorian Berndt, investment director at Main. “In particular, we are impressed by the company’s recurring software revenue growth of well north of 20 percent for years, the management team’s ambition and strong dedication to customers.”
Add-on and on
We’d written a lot about how private equity firms knuckled down on their portfolio companies via add-ons last year as new investments lagged thanks to the difficult dealmaking environment.
We’ve now got some figures to back that up, from the Centre for Private Equity and MBO Research (CMBOR) at Nottingham University Business School, supported by Equistone Partners Europe.
Private equity portfolio companies made 766 acquisitions in 2023, the third highest figure on record. Despite a drop from the first half of the year to the second, the H2 figure of 322 was also the third highest on record for that period.
In terms of size, the total value of the deals last year was €5 billion, a drop from the post-covid boom years of 2022 (€9 billion) and 2021 (€8.1 billion), but in line with 2019 (€4 billion) and 2018 (€4.2 billion).
“This fall may partly reflect the ongoing dip in valuations seen in the market as it adjusts to the broader economic downturn,” the report said.
Meanwhile, new investments struggled. Deal volume was 637 and aggregate value was €67 billion, the lowest of each since 2013.
Editor’s note: This article has been updated to include the deal size of Bridgepoint’s RoC deal.