HIG, General Atlantic sell £1.65bn FNZ to Generation, CDPQ

Kenny Wastell
09 October 2018

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HIG Capital and General Atlantic have agreed to sell UK-based financial software company FNZ to Caisse de DУЉpУДt et Placement du QuУЉbec (CDPQ) and Generation Investment Management in a deal valuing the business at ТЃ1.65bn.

Under the vendors' tenure, the business expanded its distribution network to include continental Europe and Asia. It also increased its assets under administration from £5bn to around £330bn.

A source familiar with the process told Unquote that the transaction includes a conservative level of debt.

The deal marks the first investment in a partnership between CDPQ and Generation, which will see the pair jointly commit an initial $3bn to investments with an 8-15-year duration.

Prior to the deal, HIG, General Atlantic and FNZ employees each owned 33% of the business. It is understood that the transaction will see HIG receive around £450m in equity for its stake.

The transaction comes just three months after FNZ bolted on Comdirect Bank subsidiary EBase for an enterprise value of €151m.

Previous funding
HIG backed the management buyout of FNZ in 2009 in a deal that Unquote understands was valued at less than £10m. General Atlantic then took part in an expansion round for the company three years later.

Company
Headquartered in Edinburgh and founded in 2003, FNZ provides financial software to asset managers. Its services include on-boarding, payments, trade execution, trade settlement and asset servicing. FNZ's clients include Aberdeen Standard, Barclays, Lloyds Bank, Vanguard, Generali, Quilter, Santander, Aviva, Zurich, UOB, UBS, Findex and BNZ.

FNZ has a headcount of 1,400 with offices across the UK, the Czech Republic, China, Singapore, Australia and New Zealand.

People
HIG Capital – Carl Harring (managing director).
Generation Investment Management – David Blood (senior partner); John Bernstein (partner).
Caisse de Dépôt et Placement du Québec – Michael Sabia (CEO); Stéphane Etroy (executive vice-president, head of private equity).
FNZ – Adrian Durham (CEO).