GIC and Insight buy iParadigms for $752m

Current owner Warburg Pincus gained a 6x return on its investment from the sale.

Continuing to soak up assets across the globe, the Government of Singapore Investment Corporation has joined private equity firm Insight Venture Partners to buy California-based software firm iParadigms in a deal worth $752 million, according to a statement.

The firms buy the technology business from global private equity firm Warburg Pincus, which originally invested in the business in 2008. Warburg declined to comment on return information, but a source close to the matter confirmed that it gained a 6x return on its investment in the business.

iParadigms is a California-based education technology company, specialising in software to prevent plagiarism, verify content and evaluate student learning. Its flagship product, Turnitin, is used by over 24 million students at 10,000 institutions worldwide. The company also produces verification software used by corporations and governments, according to the firm.

“We are enthusiastic about the opportunity to partner with Insight and management to help iParadigms further expand its international footprint,” Eric Wilmes, head of the North America direct investments group, at GIC Special Investments, said in a statement.

“We are very excited to be partnering with Insight Venture Partners and GIC as we execute our vision to be the most innovative and effective technology for evaluating and improving student work,” Chris Caren, chairman and chief executive of iParadigms, added.

“This partnership will provide the resources and support to accelerate our product investment plans and expand our reach into international markets.”

Warburg declined to provide additional details on the investment, but Mark Colodny, managing director and co-head of TMT at the firm, commented, “This is a great company that does important work to help maintain the integrity of the educational system. We are very pleased by what the management team has accomplished.”

GIC has historically been one of private equity’s biggest supporters from Asia, but recently has been heavily investing directly into companies worldwide – a trend that is seeing a number of LPs build sophisticated in-house investment teams.

In May, GIC agreed to buy a minority position in the hospital unit of Philippine-based Metro Pacific Investments Corporation (MPIC). The firm invested $84.4 million to acquire a 14.4 percent stake in Neptune Stroika Holdings (NSHI), MPIC’s wholly-owned subsidiary which will be the holding company for all of its hospital investments.

GIC also took on PHP 6.5 billion ($149 million; €110 million) of an exchangeable bond which can be exchanged into a 25.5 percent stake in NSHI in the future.

GIC also invested $63 million into Intelligent Energy, an international power technology company, in March, while in January, the firm teamed up with Macquarie Capital to acquire a majority interest in Australian student accommodation group Iglu. In the same month, Related Companies, an entity owned by GIC and the Abu Dhabi Investment Authority, also acquired 1.1 million square feet of office space from Time Warner in a $1.3 billion transaction.

GIC was established in 1981 and manages Singapore’s foreign reserves. It currently has over $100 billion in assets under management and invests across public equities, fixed income, real estate and private equity. In private equity, GIC invests through funds as well as directly in companies. GIC has offices in Singapore, Beijing, London, Mumbai, New York, San Francisco, Sao Paulo, Seoul, Shanghai, and Tokyo.