Court Square in $813m exit to Onex

The firm will sell graphics business SGS International roughly seven years after acquiring the company for $410m.

Court Square Capital Partners will sell graphics services company SGS International to Canada-based private equity firm Onex Corporation for $813 million.

SGS provides design-related services for the consumer packaged goods industry. The company generated approximately $390 million in revenues during the 12-month period ending 30 June, 2012. As part of the transaction, SGS’ senior management will make “a significant equity investment”, according to a statement.

Court Square acquired SGS in 2005 for $410 million when the firm was still Citigroup Venture Capital Equity Partners, the captive private equity firm within Citigroup. Court Square spun out in 2006. The firm is currently targeting $3 billion for its newest buyout fund Court Square Capital Partners III. Court Square’s previous vehicle collected $3.1 billion in 2007.

Court Square and Onex were unavailable for comment at press time.

Onex is purchasing SGS from its $4.7 billion third fund, Onex Partners III. The investment marks Onex’s first acquisition of 2012 and brings the fund to roughly 45 percent invested.

The firm will invest approximately $260 million of equity from the fund, of which Onex’ share is about $65 million as a limited partner in the fund.  The firm typically commits a significant amount of capital into its own funds. Onex first committed $800 million of its own capital to Fund III before increasing the amount to $1.2 billion.

The Toronto-based firm manages private equity, real estate and credit securities investments, managing approximately C$14 billion (€10.8 billion, $13.7 billion) of which C$10 billion is third-party capital.