GCP invests in Hippo Digital for minority stake

The deal is the second investment for GCP's fifth fund, which was registered in Q3 last year, according to Unquote Data. The fund held a first close in March 2021 on an undisclosed amount, and struck its first investment with a minority stake purchase in cybersecurity service Bridewell Consulting at the end of March.

The firm had been aware of Hippo for some time given its previous investments in the digital transformation space (notably Chaucer Group and Infinity Works, with the latter also based in Leeds), partner Alex Thomson told Unquote.

GCP met the owners of Hippo in the summer of 2020, after which Clearwater was mandated to run a sell-side process to explore options for the business, which lasted around 4-5 weeks, according to Thomson. 

GCP said its investment will assist Hippo Digital's growth plan, supporting clients while continuing its further expansion across the UK – including the creation of new technology roles in Leeds and Coventry.

The main driver of growth should be organic, Thomson said, although Hippo has already done an acquisition and could be well suited to do something similar on a larger scale.

Company
Founded in 2016 and based in Leeds, Hippo Digital is a digital transformation consultancy offering both design and delivery services to public- and private-sector organisations.

Its client base includes health and care providers, financial services and government departments. The company employs 200 staff.

People
Growth Capital Partners – Alex Thomson (partner); Jay Salter (investment manager); James Handley (investment executive).

Advisers
Equity – Osborne Clarke, Tim Hewens, Pippa Byrne, Hannah Rossi, Kristy Hart (legal); GCA Altium, Oliver Vaughan, Arthur Callaghan (corporate finance); PwC, Catherine Kay, Nathan Main (tax); Grant Thornton, Dan Rosinke, Bob McDermott, Declan Ramsey, Blane Watson (financial due diligence, tax); CIL, Tom Fletcher, Mike Hallett (commercial due diligence); Catalysis, Andy Airey (management due diligence); WA Comms, Lizzie Wills, Robert Thomas, Lizzy Cryar, Tom Ash (political due diligence); Credera, Chris Dean, Marius Rubin (IT due diligence).
Vendors – Clearwater International, Richard Goldsack, Dan Shrimpton, Tom Hickey (corporate finance).

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• Topics
• Buyouts
• Support services
• UK / Ireland
• Growth Capital Partners (aka Close Growth Capital)