Advent International, a global mid-market buyout firm, has sold Financial Dynamics, a public relations firm it has owned since 2003 for a record $260m (€201m).
FTI Consulting, a US group, has paid the highest price for a financial PR firm ever, netting Advent a 500% return on its £8 million investment in the original £26 million buyout.
Under Advent’s ownership Financial Dynamics, based in London, grew through four significant acquisitions from 9 offices to 17, employing more than 450 people in Europe, the US, Asia, the Middle East and South Africa.
A source close to the firm said it was a good fit for FTI both geographically and in terms of its revenue generation. She said: “FTI tends to be project focused, whereas Financial Dynamics works on a retained basis and has a smoother income.”
She said it was good for Financial Dynamics to have moved to an owner that really wanted the business. During its 20-year life the public relations firm has been owned by five different advertising groups, including Cordiant Communications, which sold to Advent.
The purchase price for the acquisition of $260 million is made up of $215 million in cash, $20 million in notes and deferred purchase obligations and $25 million of restricted FTI stock. To finance the acquisition, FTI intends to offer $215 million of senior unsecured notes.
Deutsche Bank, which acted as financial advisor to FTI, is financing the acquisition.
Advent is receiving cash for all of its holdings. Management shareholders are expected to take the alternate offer of cash, the FTI restricted stock and the opportunity to receive up to $80 million based on exceeding certain financial objectives over the next five years.
Robert W. Baird & Co. acted as exclusive financial advisor to Financial Dynamics.