Silverfleet to reap 3.1x money from TrustQuay sale to Hg

Ero Partsakoulaki
04 October 2022

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Silverfleet has agreed to sell its stake in TrustQuay, a provider of trust, fund and corporate services software, to Hg in an exit set to generate a 3.1x gross money multiple and an IRR of over 40%.

Completion of the transaction is expected this month and is not subject to further closing conditions, according to a press release.

Corporate finance adviser Baird was hired in the summer to assess strategic options for the business, following inbounds from potential buyers, a source close to the situation told Unquote.

TrustQuay was formed through Silverfleet's 2019 acquisition of Microgen Financial Systems and subsequent acquisition of Ohio-based Touchstone Wealth Management, according to Unquote Data. The GP backed the merger with equity from the Silverfleet European Development Fund, which held a final close on GBP 200m in December 2019. The firm also backed the roll-out of a new Software as a Service (SaaS) product, TrustQuay Online, according to the press release.

Silverfleet, which last year said it will no longer raise its third institutional fund, acquired Microgen in May 2019 from Aptitude Softw for GBP 51m, according to Unquote Data.

Hg is investing in the business via HG Capital Mercury 3, a second source familiar with the situation told Unquote. The fund gathered around USD 1bn as of March 2020 and targets European companies in the technology sector, according to Unquote Data.

Over the next phase of growth, TrustQuay aims to scale further by accelerating the digitalisation of the trust, corporate and fund service sector, including with the roll-out of TrustQuay Online, according to the press release from the buyer.

Hg, with over USD 55bn funds under management, has announced and registered four new funds since 2021.

Silverfleet and Hg declined to comment on the situation.

Company
Headquartered in Fleet, England, TrustQuay provides entity management, client accounting, practice management, compliance and workflow software for trust, fund and corporate service providers around the world, through a front to back-office platform. It has 11 offices, including in Australia, Guernsey, Jersey, Luxembourg, Singapore and the UK. It helps providers consolidate data and systems onto a single digital platform through automation.

People
Silverfleet Capital − Ian Oxley (partner).
Hg − Richard Earnshaw (director).
TrustQuay − Keith Hale (executive chairman).

Advisers
Vendor – Baird (corporate finance); Eversheds Sutherland (legal).
Equity – Skadden, Arps, Slate, Meagher & Flom LLP.
Company − K&L Gates (legal); Jamieson (corporate finance); BDO (tax).