TA Associates backs UK’s Drive Assist

US-based private equity firm TA Associates has acquired a minority stake in Drive Assist, a provider of replacement vehicles across the UK.

Drive Assist, which provides temporary replacement vehicles for road accident victims, has received an undisclosed investment in a deal led by the London office of TA Associates, the US buyout firm.

Tamworth-based Drive Assist, which was founded in 1992 and has more than 750 employees, works alongside the insurance industry to provide short-term replacement vehicles for non-fault parties involved in accidents while their vehicles are repaired.

Ajit Nedungadi, the London-based director of TA Associates who led the deal, said the size of the firm’s equity investment had not been disclosed at the request of Drive Assist’s management team. But he added that the investment was within the firm’s normal range of $25 million (€20m) to $250 million (€197m) and that it was a pure equity deal with no debt finance element.

He said Drive Assist is a “growing and profitable business” that can exploit “untapped potential in the UK” and that it will seek to grow its UK market share over the three to five years before TA seeks an exit via IPO or trade sale.     

Nedungadi established TA’s London office in the first quarter of 2003, having previously spent three years overseeing UK operations from TA’s headquarters in Boston, Massachusetts. Since then it has completed two UK buyouts: GlobeOp Financial Services, the support services and fund administration provider for hedge funds; and Sophos, the anti-virus software developer.

TA Associates is currently investing its $2.5 billion (€2 billion) ninth fund – of which at least $500 million (€394 million) can be put to work outside North America – which was raised in 2000 alongside a $500 million subordinated debt fund. Nedungadi said the next fund would be raised between this year and next and that the firm was looking to grow its presence in Europe (where the UK is the primary geographic focus).

Founded in 1968, TA Associates has offices in Menlo Park and Pittsburgh in addition to Boston and London. It provides growth capital and management buyout financing primarily for technology, financial services, healthcare and consumer businesses.