KKR sells Webhelp in €2.4bn deal

KKR's stake amounted to 55% of the business, Unquote has learned. Webhelp's value when acquired in 2015 totalled €1bn, versus €2.4bn now.

Webhelp was being marketed based on €210m EBITDA and €1.49bn sales for 2019, Unquote sister publication Mergermarket reported. The company has grown rapidly; its EBITDA has grown at a compound annual growth rate of 25.6% between 2016-2019, according to the publication.

Founders Frédéric Jousset and Olivier Duha and the management team have retained a minority stake in the business, which amounts to around 40%, according to French publication Capital Finance.

The auction, organised by Bank of America Merrill Lynch (BAML) and Robert Baird, has seen a varied group of investors bidding for the asset, according to Mergermarket. Alongside the Belgian investment holding company GBL, US-based industrial group Access Industries, French GP Eurazeo, Canadian pension funds CDPQ and PSP were bidding for the KKR-backed asset. The pension funds were looking to acquire a minority stake while co-investing with Eurazeo, French publication Capital Finance reported.

GBL, via its Sienna Capital division, has mostly acted as an LP for private equity funds, most recently backing Ergon Capital Partners IV, which closed in March this year; and Sagard III, which closed in 2017. However, Sienna also previously backed privately owned assets as a direct investor: the holding invested in the Unilever spreads division, now known as Upfield, in 2017, injecting €250m in the business and alongside KKR. It also acquired a 15% participation in the capital of Parques Reunidos Servicios Centrales in 2017 and increased its stake to 21.19% this year, investing alongside EQT. 

In a statement regarding Webhelp, GBL's CEO, Ian Gallienne, explained the holding is looking to further increase its exposure to privately owned assets. 

Webhelp has one of the highest valuations seen in France since 2008. The only other PE transactions to have reached or surpassed the €2.4bn valuation are Advent's acquisition of Safran Identity and Security (2016); Apollo's acquisition of Verallia (2015); and GIC and EDF's invesment in Total Infrastructures Gaz France (2013), according to Unquote Data. 

KKR and GBL declined to comment on the transaction. 

Debt
Sell-side adviser BAML and KKR Cap Markets were offering a staple financing at 6.5x EBITDA, Mergermarket reported.

Capital Finance reported that JP Morgan is arranging senior debt to support the transaction.

Reuters reported that the buyout is expected to be backed with senior leveraged loans of €1.2bn, which increases to around €1.4bn, including undrawn facilities. 

Previous funding
Webhelp first received investment in 2001, with Europ@Web, Turenne Capital Partenaires, Avenir Finance Gestion and Alven Capital supporting the company's early-stage expansion round.

In December 2005, Equistone Partners Europe backed the management buyout of Webhelp alongside existing shareholders Turenne, Avenir and Alven. According to Unquote Data, BPE took a majority stake in the company as part of that deal.

Six years later, Astorg Partenaires acquired a shareholding in Webhelp alongside management, BMCE, Equistone, Bank of Ireland, Alven, Turenne and Promelys Participations (Avenir), in a deal that valued the company at €200m.

Charterhouse acquired the company from Astorg and Equistone in 2011 in a transaction valuing the business at €340m. Four years later, Charterhouse made 3x money on the exit of Webhelp to KKR and the company's directors. Press reports that emerged leading up to the sale had suggested that the company would attract bids of around €1bn.

KKR had invested via its €3.3bn European Fund IV vehicle, which closed in 2015. According to Unquote sister publication Debtwire, a consortium of banks including Deutsche Bank, Nomura, Citi, HSBC, Mizuho and UBS arranged a debt package of €640m to support the deal.

Company
Founded in 2000, Paris-based Webhelp provides customer management services across digital, social, mobile and telephone. Operating in 35 countries, some of its clients include Sky, Shop Direct, Bouygues, Direct Energie, KPN, Vodafone, La Redoute, Michael Kors and Valentino.

The company employs 55,000 people and aims to achieve a turnover of €1.5bn in 2019.

Webhelp posted a €189m EBITDA and revenues reached €1.36bn in 2018, up from €118m and €927m, respectively, in 2017, and €106m and €886m in 2016, according to Mergermarket.

People
Groupe Bruxelles Lambert – Ian Gallienne (CEO)
KKR – Stanislas de Joussineau (director).
Webhelp – Frédéric Jousset, Olivier Duha (founders).

Advisers
Equity – JP Morgan, Edouard Debost (corporate finance); Rothschild & Cie, Grégoire Heuzé (corporate finance); Linklaters, Marc Petitier, Thomas Pontacq, Edouard Le Breton, Thomas Waller, Cyril Abtan, Edouard Chapellier, Pierre Zelenko, Lionel Vuidard (legal), Gide, Olivier Diaz, Charles de Réals, Aurore Martinelli (legal); Eight Advisory, Eric Demuyt, Mathieu Morisot, François Galizia, François Gallizia, Vijai Yogarajah, Oumoul Sanfo (financial due diligence);
Vendor – Bank of America Merrill Lynch, Séverin Brizay (corporate finance); Robert W Baird & Co (corporate finance); Latham & Watkins, Thomas Forschbach, Alexander Crosthwaite (legal).
Company – Jeausserand Audouard, Jérémie Jeausserand, Tristan Audouard, Carole Furst, Alexandre Dejardin, Elodie Cavazza, Faustine Paoluzzo (legal); Sycomore Corporate Finance, Olivier Barret, Pierre-Arnaud de Lacharrière, Jihane Kabouya, Marion Pouchain, Quentin de Fréminville, Sébastien Richer (corporate finance).

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