Oakley Capital Investments – acquisition of Schülerhilfe from Deutsche Beteiligungs
Third new investment for Oakley Capital Private Equity Fund III within three weeks
Oakley Capital Investments (OCL) has announced a new investment in private tutoring services provider Schülerhilfe via Oakley Capital Private Equity Fund III, which has agreed to acquire the business from DBAG Fund VI, managed by Deutsche Beteiligungs (DBAG). The transaction fits Oakley Capital’s model of partnering with entrepreneurs, with Schülerhilfe CEO Dieter Werkhausen investing in the deal alongside Fund III. OCL’s share of the equity investment is expected to be around €42m, dependent on the final capital structure at completion, with the transaction being partly funded by a debt facility from Alcentra. The investment in Schülerhilfe follows Oakley Capital’s acquisitions of intellectual property and technology services provider TechInsights, announced earlier this week, and web-server management software platform Plesk, announced two weeks ago.
Established in 1974 and headquartered in Gelsenkirchen, Germany, Schülerhilfe is the leading provider of private tutoring to primary and secondary school students in Germany and Austria, providing small-group tutoring through a network of more than 1,000 branches to over 125,000 students. The business generated revenues of €63.3m and EBITDA of €16.6m in the year to 31 December 2016. Oakley Capital’s attraction to this business stems from the growing non-cyclical demand from parents for tutoring services, and this deal builds on its experience in the education sector through its investments in Educas.
TechInsights
On 15 May 2017, OCL announced a new investment of c £18.2m in technology services provider TechInsights through its interest in Oakley Capital Private Equity Fund III, which expects to invest US$49.9m to acquire a majority stake in the business. Henry Elkington, CEO of AXIO (TechInsights’ current parent company), is investing alongside Oakley Capital and will become chairman of TechInsights at completion, bringing extensive industry experience.
TechInsights is a global leader in the intellectual property and technology services market, with expertise in semiconductor reverse engineering, used to prove patent infringement and understand the technology behind everyday consumer electronics. Its customers include the top 10 semiconductor companies globally. Following a merger with its main competitor (ChipWorks) in June 2016, TechInsights generated pro-forma revenues of c US$45m and EBITDA of US$12.6m in 2016. Oakley Capital aims to leverage the company’s extensive proprietary database to accelerate the growth of its subscription business, while maintaining its leading position in project-based patent licensing work.
Plesk
On 2 May 2017, OCL announced a new investment of c £10.0m in web-server management software platform Plesk through Oakley Capital Private Equity Fund III, which is investing US$27.4m to take a 51% controlling interest in the business, at an enterprise value of US$105m. Partnering with the existing management team, Oakley Capital is acquiring the assets and operations of Plesk as a carve-out from US technology group Parallels. The transaction represents a primary, proprietary deal in one of Oakley’s core sectors, originated though its long-standing relationships within the web-hosting industry.
Plesk is one of the most widely used control panels and software platforms, providing tools to secure and automate server and website administration, including the management of domain names, email accounts, web applications, programming languages, databases and infrastructure tasks. Plesk operates on more than 350,000 servers globally, supporting the operations of over 10m websites and 18m email accounts. The business generated revenues of US$28m and EBITDA of c US$14m in the year to 31 December 2016. Growth is expected to be driven by a number of clearly identified initiatives, made possible by the separation of the business from Parallels Group.
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