Hg invests in Argus

Katharine Hidalgo
22 October 2019

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Hg has invested in energy and commodity price reporting company Argus Media.

The firm has drawn equity from both its listed vehicle HgCapital Trust, which has invested £31.6m, and its Saturn fund. Hg Saturn closed on £1.5bn in October 2018 and targets companies with equity requirements of more than £500m and enterprise values in excess of £1bn.

Hg will become a joint shareholder in Argus, alongside Argus CEO and chairman Adrian Binks, General Atlantic and the management team.

Argus generated an operating profit of £23.5m from £76.7m in revenues for the year ending on 20 June 2018. The previous year saw the company generate £26.2m in operating profit from revenues of £70.3m.

General Atlantic is currently refinancing the company with a debt package of approximately £565m, which will fund a £150m dividend to the sponsor. The firm mandated Citi, ING, JP Morgan and SMBC to arrange the deal, according to Unquote sister publication Debtwire.

In May 2019, General Atlantic was in talks to sell a 25% stake in Argus, valuing it at £2bn, according to Debtwire. Talks with the Canada Pension Plan Investment Board reached advanced stages but collapsed in July 2019, according to reports.

Previous funding
General Atlantic acquired a 50% stake in the company in a deal valuing it at around £1bn, more than 20x its EBITDA. The founding family sold its stake and employee shareholders had the option to reinvest. A consortium of banks including Bawag, BNP Paribas, Crédit Agricole, ING, Mizuho, NIBC and Societe Generale provided a senior debt package of £220m and a rolling credit facility of around £55m to support the deal, according to Debtwire.

Company
Founded in 1970, Argus is headquartered in London and employs 1,000 staff in 22 offices. It produces price assessments and analysis of international energy and other commodity markets, and offers consulting services and conferences. Companies use Argus data to index physical trade and as benchmarks in financial derivative markets, as well as for analysis and planning purposes.

People
Argus Media – Adrian Binks (CEO, chairman).

Advisers
Equity – Deloitte (financial due diligence); Skadden Arps Slate Meagher & Flom (legal).
Vendor – Arma Partners (corporate finance); Freshfields Bruckhaus Deringer (legal).
Company – Macfarlanes (legal).