H&F earns back Gartmore investment(2)

Buyout house Hellman & Friedman is reportedly placed to make £200 million as part of a £520 million refinancing of asset management firm Gartmore less than a year after it backed a management buyout of the company.

Hellman & Friedman, the owner of London-based asset management firm Gartmore, has earned its money back from its investment less than a year ago through a £520 million (€760 million, $1 billion) refinancing of the business. The firm, which backed the £550 million management buyout of Gartmore in May 2006, will receive £200 million through a “covenant-lite” loan, according to The Financial Times.

 

“Covenant-lite” deals, which give lenders fewer rights than usual, have become a more established feature of the European private equity market. Bankers involved in KKR’s bid for Alliance Boots are understood to be sounding out investors about offering “covenant-lite” backing.

 

Private equity firms have been more and more attracted to deals in the asset management sector. Candover, CVC and The Blackstone Group recently bid for Jupiter Asset Management, which was eventually bought by US buyout house TA Associates for £740 million. It was also reported recently that Hellman & Friedman is considering bidding for global asset management firm Henderson Group.

 

Hellman & Friedman, which has offices in San Francisco, New York and London, has raised and managed more than $16 billion (€11.8 billion) since inception in 1984. It recently closed its sixth fund on $8.4 billion, and sold digital marketing business DoubleClick to Google for $3.1 billion.

 

Gartmore, which manages more than £23 billion, has offices in London, Tokyo, Boston, Madrid and Frankfurt.