Causeway supports MBO of GTI from Exponent

Kenny Wastell
05 March 2019

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Causeway Capital has invested in the management buyout of UK-based recruitment firm GTI Media from Exponent Private Equity, bringing to an end a 13-year holding period for the vendor.

Financial details of the transaction remain undisclosed. However, the company's ultimate parent, Group GTI, generated EBITDA of £1.9m from a turnover of £15.1m in the year ending in April 2018, according to publicly available documents.

GTI paid out £10.8m in redeemable preference and priority preference shares in 2018 and £9.8m in 2017, according to the documents.

The transaction comes 15 months after the group secured a refinancing package comprised of a £2.55m senior A term loan, a €2.86m senior B term loan and a £1m revolving credit facility, according to the documents. The refinancing replaced a previous mezzanine arrangement.

Causeway is currently investing from its maiden fund, which typically writes equity cheques of €2.5-10m.

Under its new owners, the group will invest in marketing activity for its software products.

Previous funding
Exponent invested £32.5m in GTI, according to the vendor's website. It first backed an expansion round for the company in 2006 and provided follow-on funding in 2008 to support the £26m acquisition of the graduate recruitment divisions of Hobsons. According to the documents, Exponent was the ultimate controlling party of the group as of April 2018.

Company
Founded in 1989 and headquartered in Wallingford, Oxfordshire, GTI is a recruitment firm and developer of recruitment software, focused on candidates who have recently completed school or university. It has a headcount of around 200.

People
Exponent Private Equity – Tim Easingwood (partner); James Gunton (director).
Causeway Capital – Pierce Casey (investment director).
GTI – Graham Storey (CEO).