Keensight debuts with French IT deal

The R Capital spin-out has made its first investment, buying French software business Smile.

Keensight Capital has made its first deal as an independent entity, taking a majority stake in French open-source software business Smile.

Keensight declined to comment on the financial details of the transaction, saying only that the investment fell within its typical size range of between €5 million and €30 million.

Smile provides software to companies across Europe, with 17 locations in countries including France, Switzerland, the Netherlands, Spain and Morocco. The business plans to expand internationally, particularly in Germany. It has maintained an average annual growth rate of 25 percent over the past five years, and produced a turnover of €50 million in 2013, according to the firm.

The deal is Keensight’s first since it spun out of R Capital Management – a subsidiary of the Rothschild Group – in November last year. However, it is the ninth investment from the relevant fund, Keensight partner Jérôme Pujol told Private Equity International.

“[Smile] is a French leader in the very fast-growing segment IT industry of open-source [software] services,” Pujol said.

“We do most of our investments in [the IT] segment. We focus on IT, healthcare and energy, but a large part of our investments are in the IT sector. [Our investment size] range is quite wide; we are actually more driven by the companies and management of the companies we are invested in, rather than the amount of money we are deploying.”

The Keensight team is currently investing from the fund it acquired when it spun out of R Capital. However, it has plans to launch a new independent fund at some point during 2014, although the exact timeline has not been decided yet, according to a source close to the matter. The firm declined to comment on the size of the existing fund or fundraising.

Asset manager Edmond de Rothschild Investment Partners – which has no connection to the Rothschild Group – will retain the minority stake it bought in Smile in 2009.