Singapore: GIC joins HgCapital-led $5.3b buyout of Norwegian tech firm Visma; KKR exits

Photo: Bloomberg

In the largest ever software deal in Europe, LSE-listed HgCapital has led a $5.3-billion buyout of Visma in a transaction that will see the investor group acquire 41 per cent of the tech company with Singapore’s sovereign wealth fund GIC picking 12 per cent. The deal is valued at EUR 4.7 billion ($5.36 billion).

Other investors that committed direct capital to the deal include Montagu and ICG.

The deal will see the firm’s management retain a 7 per cent stake in Visma, with Hgcapital stating it will invest a further £238 million ($309.5 million) in Visma. This puts the enterprise value of the total business at NOK45 billion ($5.3 billion), according to a release.

The deal will also see private equity major KKR & Co LP exit the firm with the sale of its entire stake in the software company for £1.4 billion pounds ($1.81 billion), resulting in a 3.2x return on its investment.

KKR initially acquired Visma in 2010 at an enterprise value of $1.3 billion. Since then, Visma has significantly grown revenues from NOK2.8 billion in 2010 to NOK7.9 billion in 2016, a compound annual growth rate (CAGR) of 19 per cent, and improved EBITDA margins from 19 per cent to 25 per cent.

The transaction is subject to customary regulatory approvals. The investment in Visma is primarily held in KKR’s third European fund. KKR was advised on this transaction by ABG Sundal Collier, Morgan Stanley, Simpson Thacher & Bartlett, EY and OC&C.

Another investor who saw an exit from the sale is Cinven, which will retain a minority stake in Visma. Cinven invested alongside KKR and HgCapital in a deal that saw each firm holding a 31.3 per cent equity interest.

Visma was identified as an attractive investment given its market leadership in the Nordic region its delivery of mission critical software to a wide customer base through a subscription model with high recurring revenues, and significant growth potential as customers migrate their legacy software applications to online cloud-based applications.

Anders Borg, Director and Head of the Nordic Region at KKR, said, “We are proud to have built a clear leader in the European software market over the past seven years. Visma has truly put the Nordics on the global tech map.”

In addition to this significant growth, the company has completed more than 100 add-on acquisitions over the same period of time for an aggregate enterprise value of c. $1 billion (NOK8 billion).

Øystein Moan, CEO of Visma, said: “KKR has been an outstanding partner over the past seven years to take Visma to the next phase of its development. Their support, engagement and strategic expertise from both global and local resources have been key drivers of the firm’s growth and success.”

GIC reportedly holds assets under management (AUM) of $353.6 billion as at 2016. According to its investment report for the 2015/2016 period,  Europe accounts for 12 per cent of the funds’ exposure, with the UK accounting or 7 per cent of its total portfolio.

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.