London-headquartered RJD Partners has made a 3x return on its investment in IPES, the fund administrator, in a deal valuing the company at £50 million (€59 million, $77 million).
Subject to regulatory clearance, IPES will be bought by UK-based Silverfleet Capital, six years after RJD initially acquired the company for £25 million.
Established in Guernsey in 1988, IPES has 130 employees and manages $50 billion of assets from offices in Guernsey, Jersey, London and Luxembourg. It provides fund administration and compliance services to private equity clients.
RJD first invested in IPES in 2007, and then developed the business organically through a strategy focused on recruiting new clients, winning mandates for follow-on funds, opening new offices and investing in IT, infrastructure and HR.
IPES is a fund administrator
Silverfleet sees plenty of potential to further grow the business, as the support of fund administrators often proves ever essential in today’s complex and fast-changing regulatory environment.
“The outlook for outsourcing of private equity administration is very positive as funds have to manage increasing regulatory and investor demands which are costly to provide in-house,” Ian Oxley, partner at Silverfleet Capital, said in a statement. “Legislation including [the] AIFM [directive], FATCA and Dodd-Frank will generate significant new reporting requirements and this in turn will create an opportunity for IPES as it works with fund managers to ensure compliance with these regulations.”
The transaction is the fourth exit from RJD’s Fund II, a 2007-vintage that closed on £180 million. Previous realisations have included Raphael Healthcare, on which it reaped a 1.5x return in 2012; Translinc, exited in 2011 for a 2.7x return; and Teaching Personel, which brought a 3x return in 2010.
Founded in 2001, RJD spun out from Royal London Mutual Society, the UK’s second largest mutual insurance society and RJD’s former parent, through an MBO in 2006. Its funds mainly invest in the UK service and leisure sector, in transactions within the £5 million to £75 million range.
Silverfleet, the former private equity arm of UK life insurance and financial services group Prudential, is currently investing from its 2009-vintage, £670 million buyout fund. Its latest investments include Cimbria, a Danish seed processing equipment maker bought in January, and La Fée Maraboutée, a French retailer and wholesaler of women’s fashion acquired last December. The firm has €1.5 billion of assets under management and eight companies remaining in its portfolio.