IK Partners sells Recocash to Qualium Investissement

Following this deal, QI will have a majority stake in the business alongside the management team.

IK bought Recocash from France-based private equity firm Verdoso via a limited auction process in June 2019, deploying equity via its IK Small Cap II fund, which held a final close on EUR 550m in 2019. The vehicles seeks companies with an enterprise value of up to EUR 100m across DACH, Benelux and France, according to Unquote Data.

Arnaud Bosc, partner at IK, said that the deal marks the third exit from the fund. The vehicle is at least 93% deployed, with some additional capital left for further investments in its portfolio companies.

The fund’s successor vehicle, IK Small Cap III, held a final close in April 2021 on EUR 1.2bn. It expects to make around three to four deals this year and is 36% deployed, according to Bosc.

Bosc told Unquote that Recocash performed above expectations and the sponsor started receiving offers from strategic buyers at the end of 2021, which prompted the GP to think about exit options. He added that IK intended to start a process but then proceeded to have discussions with PE and strategic suitors. Ultimately, an agreement was reached with QI prior to a process launching, he said.

Under IK’s ownership, the company has deepened its customer base, particularly in the B2B segment, according to a press release.

Guillaume Peroz, partner at Qualium, told Unquote that Recocash is close to reaching revenues of around EUR 20m and has been growing at a 10% CAGR over the last 3 years. He added that the business remained resilient during the Covid-19 pandemic. Peroz said that QI has a majority stake of around 85% in the business, while the company’s management previously held a stake of around 15% and has rolled over 50%.

With the support of QI, the company intends to strengthen its market position and explore new services, according to a press release. Peroz said the company will pursue a buy and build strategy to achieve consolidation in the space, as well as focusing on increasing its market share within the debt services sector. QI is currently investing through Qualium III and the deal marks the second investment from the fund.

The GP started marketing the fund at the end of summer 2021 and the vehiclehas raised more than EUR 400m to date. It has a target of EUR 500m, which it expects to reach by autumn 2022. Much like its predecessor vehicle, it will make minority and majority buyouts but principally acquiring majority stakes. It will look at growth and buy and build platforms. The fund backs small and medium-sized companies valued between EUR 50m-250m, and has a sweet spot in the range of EUR 100m-150m, providing equity tickets in the range of EUR 25m-75m. The LP base is the same as Qualium II, comprising France-based funds of funds, family offices and Caisse des Dépôts, said Peroz.

Qualium II held a first close in December 2017 on EUR 370m followed by a final close on EUR 425m in October 2018. The vehicle is more than 85% deployed and its investment period has ended, added Peroz. The fund backs small and medium-sized companies valued between EUR 40m-250m, providing equity tickets in the range of EUR 20m-75m, according to Unquote Data.

Company
Recocash was established in 1971 and is headquartered in France with offices in Rambouillet and Lyon. It offers a range of debt collection services including commercial dunning and collection. The business employs around 150 staff.

People
Qualium Investissement – Guillaume Peroz (partner).
IK Partners - Arnaud Bosc (partner).
Recocash - Hatime Ouali (president).

Advisers
Equity – Bryan Garnier, Thibault de Smedt, Stanislas de Gmeline, Jonathan Bohbot (M&A); PwC, Romain Godard, Jonathan Liblau (startegy due diligence); PwC, Martin Naquet-Radiguet, Céline Appel, François Bourrelier, Salah Eddine Ouadia (financial due diligence); Mayer Brown, Hadrien Schlumberger, Ségolène Dufétel, Elodie Deschamps, Maud Bischoff (legal); PwC, François Thueux, Sophie Tissier de Mallerais (ESG).
Vendor – IK Partners - Transactions R, Pierre Sader, Philippe Dubois de Montreynaud, Pierre Brenckle (M&A); Next!, Hervé Krissi, Laura Guerin (financial due diligence); VOLT, Emmanuel Vergnaud, Guilhem de Courson, Stéphane Letranchant (legal).
Management – Paul Hastings, Etienne Mathey (legal); Cazals Manzo Pichot Saint Quentin, Romain Pichot (legal).
Debt – LGT Private Debt, Guillaume Claire, Djibril Jean Diallo; Goodwin, Adrien Paturaud (legal).

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• Topics
• Exits
• Buyouts
• France
• Financials
• Secondary buyout
• France
• Qualium Investissement
• IK Investment Partners