Hg sells Allocate Software to Vista

Financial details of the deal remain undisclosed, though Vista is currently investing via its sixth fund, which typically invests in companies with enterprise values in excess of $400m. Hg's listed co-investor HgCapital Trust generated cash proceeds of £19.9m from the transaction.

The deal is the fifth divestment made by Hg's 2013-vintage £380m Mercury 1 Fund, which has generated returns of 3.2x and a gross IRR of 46% from realised investments to date, according to a statement.

Under the vendor's tenure, the company invested in product development and undertook a recruitment drive, increasing its headcount from 300 to 500. The company also started distributing its software on an international basis, with the company's products currently due to be rolled out in France, Germany, Spain and Denmark.

The business increased its turnover from £37m in the year ending in May 2013 to £44.1m in the year ending in May 2016, according to publicly available documents. Operating profit grew to £6.7m from an operating loss of £2.3m in the same period.

Previous funding
Hg acquired a 92.05% stake in Allocate for £109.6m in a take-private deal in October 2014. The GP drew capital for the transaction from its Mercury 1 Fund.

Company
Established in 1991, London-headquartered Allocate is a developer of workforce management software for the healthcare sector. It has additional operations in Sweden, France, Spain, Germany and Australia.

People
Hg – David Issott (partner).
Allocate Software – Sati Sian (CEO).

Advisers
Company – Arma Partners (corporate finance).

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• Topics
• Exits
• Buyouts
• UK / Ireland
• Technology
• United Kingdom
• Vista Equity Partners
• HgCapital
• Secondary buyout