US buyers keep up European interest as GTCR mulls GB Group offer and Resurgens brings ‘US dimension’

GTCR must confirm by 4 October whether it will make a firm offer on identity verification company GB Group.

Morning Eurohubsters, Craig McGlashan here with the final Dealflow of the week.

There is a slightly surreal air in the UK this morning after the death of Queen Elizabeth II, which ended her reign of more than 70 years. The country has entered a period of national mourning for two weeks, but PE Hub Europe will be operating as normal over this time.

US demand. We’ve been writing and hearing a lot about an increase in interest from US private equity firms for European assets, something boosted by the decades-low values of the pound and the euro against the dollar.

Yesterday we reported that one such potential deal, involving Thoma Bravo and cybersecurity firm Darktrace, will not go ahead.

But now Chicago, Illinois-based private equity firm GTCR is looking at a potential cash offer for GB Group, an identity verification, location intelligence and fraud prevention firm based in Chester in England.

GTCR announced it was mulling the offer this week and under City rules must confirm by 4 October whether it will make a firm offer.

GB Group trades on AIM, the London Stock Exchange’s market for small and medium size growth companies. Its shares were trading at £6.39 ($7.43; €7.36) – a market cap of £1.6bn – on Friday morning, having started the week below £4.50.

The firm reported revenue of £242.5 million and adjusted operating profit of £58.8 million for the year ending March 2022.

‘Relentless pursuit’. Another recent US private equity move for a European firm came in late August when Boalsburg, Pennsylvania-headquartered EnergyCAP bought Dublin-based Wattics.

EnergyCAP is a portfolio company of Atlanta, Georgia-based Resurgens Technology Partners, whose managing director and co-founder Fred Sturgis told me that European assets are an attractive proposition for the firm.

“We’re in relentless pursuit,” he said. “Where can we find the best software companies that have most typically been founder-owned and operated? There’s a large number of them in Europe, like there is in the US, and there’s maybe fewer investors in Europe that can bring a US dimension to the investment thesis. We view it as an attractive opportunity.

“The offering we’re gaining from Wattics will unlock great organic growth opportunities. Organic growth is the engine for a Resurgens investment, but we’ll always evaluate interesting ways to extend our value proposition through M&A.”

You can read more about Resurgens’ plans for EnergyCAP and Wattics in the full interview here.

European expansion. We recently covered Thoma Bravo’s opening of a London office and it looks like more private equity firms are boosting their European presence.

Levine Leichtman Capital Partners announced on Thursday that William Trevelyan Thomas has joined the firm as a director in its investment management group.

“Will brings great experience and intelligence to the team, and we are excited for the contributions he will make to our growing European business,” said Josh Kaufman, head of Europe at LLCP.

Meanwhile, Foresight Group announced on Thursday the opening of a new office in Dublin. The office is Foresight’s first on the island of Ireland and will be staffed by a new team in support of the AIB Foresight SME impact fund.

Big exit. Duke Street announced on Thursday that it has agreed to sell Medi-Globe Technologies to DCC Healthcare for an enterprise value of approximately €245 million.

DCC Healthcare is a wholly owned subsidiary of DCC plc, a FTSE 100 listed international sales, marketing and support services group.

Medi-Globe is a manufacturer and distributer of medical devices that sells into more than 120 countries. The business is headquartered near Munich.

Go ahead. The joint bid by Astorg and Epiris for Euromoney Institutional Investor moved a step closer yesterday after around 90 percent of shareholders voted to accept the offer of £14.61 per share for the entire stock of Euromoney, valuing the company at around £1.6 billion.

The offer now requires approval at a court hearing, expected to take place in the fourth quarter of 2022, and if approved, the deal will likely close in the same quarter, according to Euromoney.

The takeover will split Euromoney, with Luxembourg-headquartered Astorg taking commodity pricing service Fastmarkets and London-headquartered Epiris having majority control of the rest.

That’s it from us this week. Have a good weekend and we’ll speak again on Monday.

Cheers,

Craig