BIP on look-out for targets following CVC investment

CVC acquired a majority stake in the Italian management consulting and business integration service at the beginning of June, Capè said, describing CVC as a long-term investor.

BIP was courted by several large funds ahead of CVC's investment, Capè said. Bain, Cinven, BC Partners and Intermediate Capital Group (ICG) also showed initial interest in the company, as reported in March. 

The deal value was in the €700-720m range, equivalent to 10x EBITDA, two sources close to the situation said, adding that BIP was marketed based on a €70m 2021 EBITDA. Capè declined to comment on the financial terms of the deal, but said that it plans to use improved access to capital for strategic acquisitions. 

The outside investment will allow the company to reach the next stage of development, Capè said, adding that BIP aims to complete a string of deals next year with target sizes ranging from around €30m to €100m. The company already has a list of 10-15 potential targets, he said, adding that talks have yet to begin.

Acquisitions could be funded through a combination of cash and equity from the company's shareholders, he said. 

BIP is looking for targets with excellent positioning in their markets and strong local client bases, he said. Ideal targets are specialist financial services consultancies serving the insurance and banking industries, or with a vertical specialisation in the pharma sector. These would be in adjacent verticals to BIP's core business, Capè added, allowing it to extend its offering outside the energy and telecommunications spaces.

Geography is critical, as the company is looking to expand its US footprint, Capè said, adding that it has mandated Equiteq to facilitate its M&A-fuelled expansion in that market. The Covid-19 pandemic has changed BIP's M&A plan, shifting its radar to the US following last June's €60m acquisition of Chaucer Group, a London-based digital consultancy, he said. 

Capè described the Chaucer deal as strategic, and said it will allow BIP to quickly expand consulting services between the UK and the US. Besides its London operations, Chaucer has an office with 50 staff in Boston, Massachusetts, so BIP would prefer to acquire targets based there, as well as in the New York and Washington states, he said, adding that the American market is huge and very competitive. 

Other interesting regions for expansion are France and Germany, Capè said, adding that M&A will boost BIP's growth so it can both compete better locally and more quickly expand its footprint in both countries. 

BIP generated €50m in EBITDA from €300m in revenues in 2020, and is set to see a 15% increase in both this year, he said.

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