Apax nets 4x on ASM

The firm has sold US-based Advantage Sales & Marketing to CVC and Leonard Green for about $4bn.

Apax Partners has agreed to sell its majority stake in Advantage Sales & Marketing (ASM), a North American provider of outsourced sales and marketing services, to Leonard Green & Partners and CVC Capital Partners, according to a statement.

Financial details of the transaction were undisclosed, but a source close to the matter said the enterprise value was approximately $4 billion and would generate a 4x return for Apax. The senior management of ASM will maintain a stake in the company.

Apax declined to comment, while CVC did not return a request for comment at press time.

The business was sold in an auction process run by JP Morgan & Bank of America Merrill Lynch.

Apax bought a significant majority stake in ASM in December 2010. The majority of the capital came from Apax Europe VII, a €11.2 billion vehicle the firm raised in 2007, although it also used some capital from its European fund VI, a €4.31 billion 2005-vintage, and Apax US VII, a $856.34 million 2006-vintage.

As of 31 March 2014, Apax Europe VII was generating a net multiple of 1.2x, according to a recent interim report of Standard Life European Private Equity Trust.

ASM, which has a team of more than 38,000, provides sales and marketing services to consumer suppliers and retailers. In the statement, Apax said that during its ownership, ASM achieved “substantial growth”, both organically and through strategic acquisitions, while also expanding into new channels and improving its technology platforms.

The transaction was made by CVC's latest fund, CVC European Equity Partners VI, which reached its €10.5 billion hard-cap last June, PEI reported at the time.

In March, the firm bought Synsam Nordic, an optician chain in the Nordic region, from Alipes, a Swedish investment firm owned by IKEA Investments, and former store owners. It is unclear whether this investment was made from CVC's latest fund. 

In February, CVC was still investing from its CVC European Equity Partners V, a €10.75 billion fund it closed in 2008. It used this vehicle to acquire AVAST, a US-based security software company, in a deal that valued the company at $1 billion.

It also used this fund for two deals it completed in the latter half of 2013: the simple meals business of NYSE-listed Campbell Soup Company, which it bought for €400 million in October, and warranty specialist Domestic & General, which it bought for £800 million from Advent International in August.