FPE sells Masstech to Genstar’s Telestream

The sale will generate an initial 2.6x return for the fund. A significant proportion of the proceeds will be reinvested in Telestream alongside Genstar.

This is the second exit inked by FPE Fund II, following its sale of IWSR, a B2B data and intelligence provider, to Bowmark Capital in February 2021.

The fund closed on £100m in 2017 and has made nine deals so far. It has recently acquired a large minority stake in Codestone, a UK-based business application software and cloud services platform.

The vehicle targets growth investments and buyouts in UK-based companies with enterprise values of £20-50m and turnover in the £5-25m range. It focuses on the software and services sectors.

The sale of Masstech ends a three-year holding period for FPE. The GP acquired and merged digital media companies Masstech and SGL in May 2017 to create a digital content software production platform. George Kilpatrick from AWS was appointed as CEO to consolidate the two products into one cloud-optimised platform.

Telestream is a US-based company specialised in digital video software. In 2015, the business was backed by Genstar Capital, a San Francisco-headquartered private equity firm dedicated to investments in the technology sector.

Company
Established in 1991, Masstech provides software that allows media organisations to manage digital content while optimising video storage and associated workflows.

The company is headquartered in Fareham, with further offices in Cincinnati and sales and support offices in the US, Europe and Asia.

People
FPE Capital – David Barbour (managing partner).
Masstech – George Kilpatrick (CEO).

Advisers
Vendor – Stifel (corporate finance); Stephenson Harwood (legal).

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