Sovereign divests Cordium to European Capital

European Capital was successful in "a highly competitive auction process", according to adviser Ropes & Gray.

The private equity firm has been active recently, having sold its portfolio company Farrow & Ball to Ares Management this week. The deal value was £275m, rewarding the firm with a 5.4x return on its initial 2006 investment.

Previous funding
Sovereign acquired Cordium, formerly the IMS Consulting Group, in November 2010. The GP committed an initial £15m, as well as a war chest provision, financed from the Sovereign Capital Limited Partnership Fund III, in exchange for a majority stake.

Lloyds Bank Corporate Markets acted as sole mandated lead arranger of a senior debt facility, and provided clearing and hedging services to support the transaction.

Sovereign appointed Michel van Leeuwen as group CEO and Tony Solway as non-executive chairman. It also backed eight strategic acquisitions, including HedgeOp in New York, HedgeStart in London and Zodiac Advisory Services in Malta. Cordium also expanded into Hong Kong, where it opened offices and extended its offering into the accounting and tax areas.

The company claims to have four times as many clients now as at the time of Sovereign's original purchase.

Company
Founded in May 2013 following the merger of IMS Group, HedgeOp Compliance and EvenWheel Solutions, Cordium is a global compliance and regulatory services provider. It has 180 employees supporting 1,500 investment businesses.

Headquartered in London, it has additional offices in New York, Boston, San Francisco, Malta and Hong Kong.

People
Neil Cox is a director at Sovereign.

Advisers
Vendor – Rothschild, Stuart Vincent, Alex Mathé (Corporate finance); Pinsent Mason, Tom Leman (Legal); Alvarez & Marsal, Philip Mitchell (Financial due diligence); EY, Harry Nicholson (Commercial due diligence).
Equity – Ropes & Gray, Kiran Sharma, Brenda Coleman, Monica Gogna, Michelle Moran, Matthew Cox, Elizabeth Todd, Nick O'Grady, Shona Ha, Andrew Douglas (M&A, tax).
Management – Squire Patton Boggs (Legal).

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