The Carlyle Group has made a “significant investment” in Addison Lee, a private cab company with more than 4,500 vehicles around London.
Financial details of the transaction were undisclosed, but press reports suggested the deal values Addison Lee at £300 million (€349 million, $457 million).
Carlyle could not be reached for comment at press time.
Since Addison Lee was established in 1975, starting out with one car, the company has grown to a fleet of over 4,500 vehicles and carries over 10 million passengers and couriering one million deliveries per year.
Carlyle plans to expand the business both in the UK and internationally by providing transport services to a wider range of corporate clients and individual customers. It also aims to develop the company’s technology platforms and brand experience.
Addison Lee is a “strong business and brand with great potential”, Andrew Burgess, a managing director of Carlyle Europe Partners, said in the statement. “As experienced investors in the automotive and transportation sector through companies such as Applus+, Hertz and RAC, we hope Carlyle’s experience and expertise will allow us to support the plans to continue growing the business both in the UK and internationally and to create value,” he said.
It is the second investment from Carlyle’s Europe Partners III, a €5.4 million fund, since the firm obtained a one-year investment extension last summer. In exchange for this, Carlyle lowered its management fee and agreed not to charge transaction fees during the extended period. Carlyle now has until 20 December 2013 to invest this 2006 vintage, which had approximately 20 percent of its capital left last August.
Since the investment extension, Carlyle acquired DuPont Performance Coatings for $4.9 billion, using both Carlyle’s European Partners III and Carlyle Partners V. It then renamed the business Axalta Coating Systems.
Carlyle Europe Partners III has not been one of Carlyle’s best performing investment vehicles, PEI reported last summer. The fund was producing a 0.7 percent net internal rate of return and a 1x investment multiple as of 30 September 2012, according to publicly available performance information from the California Public Employees’ Retirement System. This was in stark difference with Carlyle’s $13.7 billion Fund V, which was generating an 9.5 percent IRR and a 1.3x multiple as of 30 September 2012, according to CalPERS information.