SGG Group buys Augentius in fund admin consolidation play

The transaction is subject to regulatory approval. Should it go through, it is expected to make SGG the fourth largest investor services firm worldwide, with assets under administration of more than $400bn. Following the completion of the deal, and taking into account a string of other recent acquisitions, the group will employ 2,350 professionals across 24 jurisdictions.

SGG was advised by Baird on the transaction, while Augentius was advised by William Blair.

Established in 2002, Augentius was hitherto one of the main independent fund services businesses worldwide. It provides administration and depositary services to private equity and real estate managers.

SGG is a global investor services firm providing a range of compliance, administration, asset and advisory services to alternative investment funds, international companies, families and entrepreneurs. French GP Astorg Partners bought the Luxembourg-headquartered firm from Belgian investment firm Cobepa in 2015.

The group has made a number of bolt-ons since the buyout and is aiming to play a key role in the ongoing consolidation of the fund services industry worldwide. This trend is expected by many in the industry to pick up pace in the coming months; according to the eVestment Alternative Fund Administration 2018 survey released earlier this year, 74% of alternative fund administration firms expect more consolidation in the sector, against 47% in the 2017 survey.

Private equity firms are also expected to benefit from this trend as investors – most recently, Silverfleet Capital agreed to sell fund administration business Ipes to Genstar Capital portfolio company Apex Group. Financial details of the transaction were not disclosed, though Unquote understands the deal gave the company an enterprise value in the region of £150m. The transaction generated a 3.8x return for Silverfleet following a five-year holding period, equivalent to an IRR of 30%.

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