In Profile: Apax Partners

The close of Apax Partners' ninth fund in December brought the GP's total committed capital to more than $46bn across all its funds. Although it is a global fund, it was the third largest fundraise in 2016 of a vehicle with a remit that includes Europe, according to unquote" data. The close of Apax IX on the dual-currency (US dollar and euro) vehicle's hard-cap of $9bn in December 2016 exceeded its original target of $7.5bn at launch, the previous January.

Click here to view a complete profile of Apax Partners IX, including a comprehensive list of LPs and their individual commitments, as well as up-to-date portfolios, on unquote" data

Despite securing huge pools of capital in recent years – Apax VIII raised $7.5bn and Apax Europe VII raised €11.2bn – the sponsor does not divert from its investment strategy of targeting four defined sectors: tech & telecommunications, services, healthcare, and consumer. However, the GP has more recently focused on a common thread of digital transformation throughout.

Portfolio company Auto Trader Group is testimony to this. Apax funds invested in Auto Trader in 2007, when digital revenues amounted to 40% of total revenues. By 2015, 100% of Auto Trader's revenues were generated online. In Q1 2015, the business was listed in the largest ever UK sponsor-backed IPO.  

Apax funds typically invest between $150-900m, from the upper echelons of the mid-market to the bumper buyouts on the other end of the spectrum.

As a rule of thumb, Apax funds invest 40% of their capital in the US, 40% in Europe and 20% in the rest of the world.

Though separate entities, the paths of Apax Partners and Apax France crossed in 2007 when they jointly invested in Switzerland-based medical diagnostics group Unilabs, together with Nordic Capital in a take-private from the Swiss stock exchange. In December last year, Apax Partners took majority control – via its ninth vehicle – acquiring the stakes of Nordic Capital and Apax France.

Both funds also share Altamir as an LP after it committed to investing €138m in the Apax IX fund and €60m in the Apax VIII fund, according to an Altamir press release at the time.

Fundraising and investments  
Apax VIII – which closed on $7.5bn in 2013 – made headlines at the time for abolishing transaction fees and having made a sizable management contribution of €470m. Its predecessor Apax Europe VII raised €11.2bn.

In 2016, Apax funds acquired Dominion Marine Media, Neurapharm, Invent Farma and Ingeneria Informatica in July; and Duck Creek Technologies in August.

And in terms of realisations, Apax funds recently announced an agreement to sell half of their stake in GlobalLogic to the Canada Pension Plan Investment Board; Ascential was floated on the London Stock Exchange for £800m in February; Plantasjen was sold to Ratos in September; Epicor Software Corporation was sold to KKR; and Trader Corp was sold to Thoma Bravo in July. Apax funds also sold a stake in Sisal in May.

Some of the longer holding periods currently in the 40-strong portfolio include German low cost fashion retailer Takko, which has been held by the GP for over seven years.

Returning money to LPs
Apax funds have realised more than $21.5bn for investors over the past 24 months, equating to a 3.4x money multiple and 27% gross IRR, the GP stated. The figure rises to $22.4bn over the past 36 months, including $8.2bn generated in 2016 alone.

Apax IX attracted both existing and new investors. These include public and private pension funds, sovereign wealth funds, funds-of-funds, insurance companies, endowments, charitable foundations, and high-net-worth individuals. Approximately 44% of the capital came from investors in North America, 23% from investors in Asia, 21% from European investors and 12% from the rest of the world.

According to unquote" data research, LPs that committed significant amounts to the fund include the Washington State Investment Board, the Oregon Public Employees Retirement Fund and the Kansas Public Employees Retirement System. CPPIB has been an LP for some time, taking part in two co-invests: GlobalLogic and Acelity (formerly KCI).

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