Gresham exits 7City

The sale marks the third exit in 12 months for the UK firm, which is expected to raise Fund V this year.

Gresham Private Equity, a London-based mid-market investor, has sold training company 7City Learning to Fitch Group. 

The terms of the transaction were not disclosed, but a source close to the deal said the transaction was valued at around £90 million (€105.69 million, $142.28 million). This represents three times the amount Gresham paid to acquire the company, the source said. 

The firm declined to comment on investment return. 

Headquartered in London, 7City provides training services, primarily to the financial services industry, in the classroom or via distance learning solutions. Its client base comprises around 800 corporate and financial institutions, including nine of the top 10 investment banks and all of the 10 largest fund management businesses in the world, according to a statement.

7City provides 
training to the financial
services industry

The post-crisis environment provided a fertile ground for the company to grow, Paul Marson-Smith, managing partner at Gresham, told Private Equity International. “When we invested in 2007, it was clear to us that there was going to be more regulation, rather than less. We also recognised that 7City had a potentially disruptive business model, that was embracing new technologies, to replace class-based learning.”

The company will now be combined with Fitch’s Training unit, and continue serve the growing need for training in financial institutions worldwide, said Marson-Smith. “Investing in compliance training is not a discretionary purchase for investment banks, they need to have their staff accredited.” 

This exit rounds out an active 12 months for Gresham. The firm made two news investments and eight bolt-ons in 2012, as well as two exits: it reaped a 4x return on its sale of Olaer in April, and a 3.9x return when it divested Marston Group in June. 

Marson-Smith expected more realisations to come in 2013, as well as opportunities for new investments in the UK lower-mid market. “We are seeing many strong opportunities to acquire rapid growth businesses: there are pockets of growth within the UK in industries where we believe the UK leads the world.”

Gresham is expected to launch Fund V this year; its fourth fund closed on £340 million in 2006. The firm declined to comment on fundraising.