HgCapital announces investment in Valueworks

RNS Number : 1414O

HgCapital Trust plc

08 October 2012

 



HgCapital Trust plc will participate in the acquisition of a majority stake in Valueworks Ltd ("Valueworks") alongside other institutional clients of HgCapital. The Trust, whose shares are listed on the London Stock Exchange, gives private and institutional investors the opportunity to participate in all HgCapital's investments. The Trust will contribute a total of approximately £2.5 million.

Based on the 31 August reported data and adjusting for the impact of this transaction, liquid resources (including a £40 million undrawn loan facility) are estimated to be £125.5 million (33% of the 31 August NAV). The transaction will reduce the Trust's outstanding commitments to HgCapital funds to £169 million.

HgCapital announces substantial investment in Valueworks

London, 8 October 2012: HgCapital has today announced a majority investment in Valueworks Ltd, the UK-based online marketplace provider. The transaction marks the first investment of the HgCapital Mercury fund, a fund raised in the last year specifically to target lower mid-market buyouts in selected TMT sub-sectors.

Valueworks' founding shareholders will reinvest a considerable portion of their stake in the business as part of the transaction. The transaction is expected to close on 31 October 2012.

Founded in 2000, Valueworks provides its proprietary e-Marketplaces platform to numerous landlords, contractors and merchants in the UK social housing and wider construction market.  Valueworks offers a sophisticated technology platform which enables buyers and sellers to manage their supply chain activities in a highly efficient manner delivering reduced costs and increased operational efficiency for all parties and while operating within the constraints of procurement legislation.

The investment in Valueworks represents a continuation of HgCapital's sector-driven investment strategy, which seeks to partner with market-leading TMT companies supporting proven software and electronic network businesses with substantial potential for growth.  Valueworks has a similar business model to HgCapital's existing electronic network TMT investments, Epyx (HgCapital 6 fund) and Achilles (HgCapital 5 fund).

HgCapital will support the existing management team with a focus on growing the business as a key procurement hub in housing and related construction sectors.

Commenting on the acquisition, Matthew Brockman, who leads HgCapital's Mercury team, said: "We are delighted to make our first investment from the new Mercury fund.   The Mercury fund was recently established to extend HgCapital's TMT investment focus on software and technology enabled services into smaller European buyouts. As a leading electronic network similar to several other businesses that we have backed, Valueworks is a great example of the companies that we seek to support with the fund."

Added David Issott, who co-led the deal for HgCapital's Mercury team: "We are excited to support the founding management team of Valueworks as they continue to build a leading procurement network within the UK construction sector. Valueworks provides an essential service to housing landlords and suppliers and we look forward to contributing our specialist knowledge of these business models to further develop its products and services."

Jeff Dandridge, CEO of Valueworks, said: "Finding a blue-chip commercial partner such as HgCapital who could really help us take our technology service to a much wider audience is a real coup for us and we're really looking forward to Valueworks moving to its next stage of development.  This is great news not just for Valueworks' employees but also our clients. "

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For further details:

HgCapital	Richard Bold	[phone]
Maitland	Neil Bennett George Hudson Rowan Brown	[phone]

About HgCapital

HgCapital is a sector expert private equity investor, supporting management teams to grow industry champions. Deeply resourced sector teams focus on specific sub-sectors and investment themes to identify companies occupying an established position within a niche, and which have the potential to grow faster than their market, create employment and become the leader in their industry. HgCapital's dedicated portfolio management team provides practical support to management teams to help them realise their growth ambitions. HgCapital invests in expanding segments of the Healthcare, Industrial, Services, TMT and Renewable Energy sectors across Western Europe.

Based in London and Munich, HgCapital manages over £3.8 billion for some of the world's leading institutional and private investors. For further details, please see www.hgcapital.com.

About HgCapital Trust plc

HgCapital Trust plc is an investment trust whose shares are listed on the London Stock Exchange (ticker: HGT.L). The Trust is a client of HgCapital, giving investors exposure to a portfolio of high-growth private companies, through a liquid vehicle. New investments and existing portfolio companies are managed by HgCapital, an experienced and well-resourced private equity firm with a long-term track record of delivering superior risk-adjusted returns for its investors. The Trust has won the Investment Week Private Equity Investment Trust of the Year every year since 2005. For further details, please see www.hgcapitaltrust.com

Neither the contents of HgCapital's, HgCapital Trust's nor Valueworks' website nor the contents of any website accessible from hyperlinks on the websites (or any other website) is incorporated into, or forms part of, this announcement.

 

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