(Bloomberg) -- BC Partners has agreed to sell 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 ($9.7 billion).
The London-based private equity firm is divesting most of its stake to GardaWorld’s founder and chairman, Stephan Cretier, and some of the firm’s top executives, who will together hold about 70% of the business, according to a statement that confirmed an earlier Bloomberg News report.
Private credit firm HPS Investment Partners will hold the remaining interest alongside other investors including Oak Hill Advisors and One Investment Management, while BC Partners will also keep a minority stake. The transaction is expected to close by Feb. 28.
BC Partners-led investors including Cretier acquired Rhone Group’s interest in Montreal-based GardaWorld in 2019 in a transaction valuing the company at C$5.2 billion, 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.
GardaWorld’s operating profit has more than doubled in the past five years, according to Paolo Notarnicola, partner and co-head of services at BC Partners.
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. The GardaWorld stake sale will increase the firm’s proceeds generated from exits to 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 BC Partners’ 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.
BC Partners 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.
Private lenders are increasingly keen to back major buyout deals, threatening traditional banks’ dominance of the lucrative corporate loan market. Nimble private credit firms, which lend directly to companies rather than syndicating loans to a large group, stole in to grab a hefty chunk of the market.
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