(Bloomberg) -- BC Partners is close to selling a large portion of its controlling stake in GardaWorld back to its management team, in a transaction that values the Canadian security services firm at about C$13.5 billion ($9.8 billion), according to people familiar with the matter.
The London-based private equity firm is divesting a majority of its 51% stake to GardaWorld’s founder and chairman, Stephan Cretier, and some other members of the management team, the people said, asking not to be identified as the matter is private. The deal is backed by a group of private credit firms, led by HPS Investment Partners, who are committing several billions of dollars to the management of GardaWorld to support the buyout, the people said.
Discussions are advanced and a formal agreement is likely to be reached this week, the people said. BC Partners is likely to retain a small minority stake in the business after the transaction, the people said. HPS, one of the world’s largest private credit firms, will also secure a minority stake, according to the people.
A representative for BC Partners declined to comment, while representatives for GardaWorld and HPS couldn’t immediately respond to requests for comment outside business hours in North America.
BC Partners-led investors including Cretier acquired Rhone Group’s interest in Montreal-based GardaWorld in 2019, in what was the largest private equity deal in Canada at the time. Under the buyout firm’s ownership, the company has transformed itself from a pure-play security services firm and expanded into AI-enabled surveillance monitoring, risk intelligence platforms and cash automation. In the past five years, GardaWorld has doubled its earnings before interest, tax, depreciation and amortization to about C$1 billion, the people said.
BC Partners, one of Europe’s oldest and best-known private equity investors, has been focused on returning money to investors, after raising its latest flagship fund in 2022. With the exit of GardaWorld, the firm will have generated proceeds of over €11 billion ($12 billion) in the last 18 months for its fund limited partners and co-investors.
The GardaWorld exit comes on the back of the initial public offering of its publishing services firm Springer Nature AG & Co. this month. Earlier in the year, the firm agreed to sell Italian frozen pastry and bakery products maker Forno d’Asolo SpA to a consortium backed by Investindustrial and the Bagnoli family. It also completed a stake sale in Italian machinery maker IMA Industria Macchine Automatiche SpA to US merchant bank BDT & MSD Partners. Last year, BC Partners agreed to divest a minority stake in PetSmart to Apollo Global Management Inc.
--With assistance from Silas Brown.
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