Gilde buys minority stake in Emeram's Init

The company's management and Dirk Stocksmeier, founder and chairman of the supervisory board, will remain shareholders of Init.

Unquote sister publication Mergermarket reported in July 2021 that the sale was in its second round, with Init marketed based on EBITDA of EUR 30m-35m. The company posted EBITDA of EUR 8m on Emeram's initial investment in 2019, Mergermarket reported. The business was expected to go to a strategic buyer, sources told Mergermarket.

Emeram acquired Init in a buyout in 2019, investing via Emeram Private Equity Fund I. The vehicle held a final close in January 2015 on EUR 400m. Emeram generally invests in DACH-based companies with revenues of EUR 20m-150m and enterprise values of EUR 30m-250m, as reported.

Emeram's acquisition of Init was backed by debt from Permira; the lender had also provided financing for the GP's acquisition of digital agency Diva-e.

Gilde is currently investing via Gilde Buy Out Fund VI, which held a final close in 2019 on EUR 1.4bn. The fund generally acquires businesses with enterprise values of EUR 100m-250m, deploying an average equity ticket of EUR 75m per deal, according to Unquote Data.

Following Gilde's investment, the company aims to continue its growth via strategic opportunities, the expansion of its international focus, and acquisitions.

The deal is expected to close in January 2022.

Company
Founded in 1995 and headquartered in Berlin, Init is a digital transformation consultancy that provides services for public clients, including strategy implementation and development, as well as IT security and data centre operations.

Init posted 2019 revenues of EUR 60.7m, versus EUR 43.4m in 2018, and expected to post 2020 revenues of EUR 64.5m, according to its latest publicly available accounts for 2019. Init has 800 employees, versus 500 when Emeram invested in 2019.

People
Emeram Capital Partners – Christian Näther, Kai Obring (managing partners); Katharina Pohl (investment manager); Ruprecht Puchstein (senior investment manager).
Gilde Buy Out Partners – Matthias Wilcken (partner).
Init – Dirk Stocksmeier (founder).

Advisers
Equity (Emeram Capital Partners) – GCA Altium (M&A); Noerr (legal, tax); Strategy& (commercial due diligence); PwC (financial due diligence); Shearman & Sterling (legal, debt advisory).
Equty (Gilde Buy Out Partners) – Clifford Chance (legal); Deloitte (tax, financial due diligence); Boston Consulting Group (commercial due diligence); Shearman & Sterling (legal, debt advisory).
Management – Taylor Wessing (legal, tax); Drake Star Partners (M&A); Shearman & Sterling (legal, debt advisory).

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• Topics
• Buyouts
• DACH
• Technology
• Gilde Buy Out Partners
• Germany