EI delivers 7.3x cash in Warsaw IPO

Polish private equity firm Enterprise Investors has fully exited its 50 percent stake in banking software firm Comp Rzeszow through an IPO on the Warsaw Stock Exchange.

Comp Rseszow, a Polish provider of banking software, has listed on the Warsaw Stock Exchange, in the process delivering an exit for the 50 percent stake held by private equity firm Enterprise Investors (EI).

According to a statement issued by EI, the sale yielded a 7.3 times investment multiple and net proceeds of $37.7 million. The “heavily oversubscribed” offering raised $53 million and drew in a strategic investor in the form of Polish systems integrator Prokom-Software, which has acquired a 17 percent stake in Comp Rzeszow.

EI’s Polish Enterprise Fund invested $5.2 million in expansion capital in Comp Group in 1988. Between then and 2003, the firm reportedly increased sales and net profits fourfold. In 2004, sales are forecast to increase 15 percent to $30 million, while net profits are forecast to rise 37 percent to $4 million.

The statement says Comp Rzeszow is now the number three software producer for the banking sector in Poland, serving 30 percent of all banks in the country.

“This exit shows that valuations eventually come around for companies with solid business fundamentals and a convincing growth story,” said Piotr Augustyniak, vice president at EI.

Comp Rzeszow represents EI’s second launch of an IT company on the Warsaw Stock Exchange, following the IPO of ComputerLand in 1995, which yielded a 7.4 times investment multiple.

Founded in 1990, EI manages funds totalling $1.1 billion and has invested $763 million in 94 companies. It claims to have fully exited 65 investments and returned $732 million to investors.