AXA sells home shopping business to Providence

AXA Private Equity has sold a majority of television mail-order company Home Shopping Europe to Providence Equity Partners for an undisclosed sum.

AXA will retain a 15 percent stake in the company, which operates in countries including Austria, Germany, Italy, Russia and Switzerland. The firm purchased 100 percent of Home Shopping Europe in 2009 in an all-equity transaction from then-bankrupt German retailer Arcandor. AXA invsted from its AXA LBO Fund IV that closed on €1.6 billion. The firm also makes direct private equity investments in Europe from its 2009 vintage funds AXA Capital Fund that closed on $328 million and AXA Central and Eastern Europe Fund that closed on $170 million.

Providence Equity Partners is investing in Home Shopping Europe from its sixth fund that raised $12 billion in 2007. The firm currently has television investments in US sports and entertainment channel YES Network, online television distribution company Hulu and Spanish-language media company Univision Communications.

Providence is currently in market with its seventh fund, which has collected between $4 billion and $4.5 billion toward a $6 billion target. The firm’s fifth fund, which raised $4.2 billion in 2004, was generating a gross multiple of 1.4x and a 5.8 percent internal rate of return, as of 31 December 2011, according to performance data from the California Public Employees’ Retirement System. Fund VI is producing a gross 1.1x multiple and a 3 percent IRR.

Last month, Providence invested in Canadian data centre operator Q9 Networks alongside The Ontario Teachers’ Pension Plan and Madison Dearborn Partners in a deal valued at C$1.1 billion.

Providence was founded in 1989 and controls around $23 billion in assets under management, according to its website. The firm typically targets equity investments between $150 million to $800 million.