EQT Private Equity and TA to welcome Hg as a significant minority partner in IFS and WorkWave at a USD 10bn valuation
EQT VIII to sell a large part of its stake in cloud software vendors IFS and WorkWave to Hg, in a transaction valuing the Companies at USD 10bn. EQT Private Equity to remain majority shareholder alongside Hg, TA and the management teams
Since the acquisition by EQT VIII and EQT IX, IFS has grown Cash EBITDA by 51 percent p.a. and established a global leadership position within cloud software for companies which want to differentiate on service
Since separating WorkWave from IFS in 2021, WorkWave has more than tripled revenues by combining a compelling organic growth strategy and three transformational add-ons, cementing a leadership position within cloud software for recurrent Field Service verticals
EQT Private Equity, Hg and TA to support IFS’s and WorkWave’s continued value creation journeys, including investments in their organizations and product capabilities, while pursuing further growth, both organically and through add-on acquisitions
EQT is pleased to announce that the EQT VIII fund has agreed to sell most of its stake in IFS and WorkWave (the “Companies”) to Hg in a transaction valuing the Companies at USD 10 billion. Existing minority shareholder TA will also divest a portion of its stake to Hg. The EQT VIII and EQT IX funds (together, “EQT Private Equity”) remain in voting control as the largest shareholder in IFS and WorkWave alongside Hg, TA and the Companies’ respective management teams following the closing of the transaction.
Founded in 1983, IFS is a globally recognized leader in developing and delivering cloud-based enterprise software. IFS provides a single unified platform delivering best-in-class Field Service Management (FSM), Enterprise Asset Management (EAM), Enterprise Resource Planning (ERP) and Enterprise Service Management (ESM) solutions. IFS is a key enabler for customers digitizing their core operations while contributing to more efficient use of resources and assets across its customers’ value chain. IFS has over 4,500 employees in more than 50 countries, serving thousands of customers worldwide.
Since EQT Private Equity and TA acquired IFS from the EQT VII fund in 2020, the company has continued its transformation journey into a global enterprise software champion. Several strategic initiatives have contributed to this success, including the launch of IFS Cloud, the “Moment of Service'' rebranding, the establishment of a fourth product segment in ESM (through IFS Assysts) and completion of three add-on acquisitions. Between FY19A and FY21A, IFS grew Cash EBITDA by 51 percent per annum and Software Revenues by 22 percent per annum, with 70 percent of revenues this year being recurring.
Founded in 1984, WorkWave is a leading provider of software and related digital solutions to recurrent service verticals within field service management (FSM). WorkWave’s solutions empower companies in their target verticals to reach their full potential through scalable, cloud-based software solutions that support every stage of their business life cycle, including marketing, sales, service delivery, customer interaction and financial transactions.
Following the 2021 decision to separate WorkWave from IFS and operate it as a standalone portfolio company, WorkWave has grown revenues three-fold through rapid organic growth combined with three transformational add-on acquisitions. In less than 12 months, WorkWave has grown from being the leading software provider in one vertical to having the clear leadership position across four main vertical segments within recurrent Field Services. The company has also expanded its digital offerings including continued success with its payments solution.
EQT, Hg and TA will support IFS’s and WorkWave’s continued standalone growth journeys, cementing and strengthening their respective leadership positions. Further investments will be made in the companies’ organizations and product capabilities, both organically and through strategic add-on acquisitions.
Johannes Reichel, Partner within EQT Private Equity’s Advisory team, and Naveen Wadhera, Managing Director at TA, said, “The continued push of industries and enterprises to digitize and streamline their core operations presents a great opportunity for innovative software leaders like IFS and Workwave. Both companies have undergone significant transformation journeys to date and are now well positioned to take advantage of several global thematic trends, including customers increasingly relying on cloud-based software to deliver even better service to their customers as well as more sustainable usage of their resources and assets. We would also like to thank the high-performing teams at IFS and WorkWave, led by Darren Roos and David Giannetto respectively.”
Darren Roos, CEO of IFS and Chairperson of WorkWave, said, “We’re proud to have built two amazing software brands – and we continue to go from strength-to-strength. We are structured to scale, we have class-leading technology, and our people and partners remain obsessed with customer satisfaction. These have been the foundations of our success at both IFS and WorkWave, and now with the additional backing and software expertise of Hg alongside EQT and TA, we have the ability to accelerate our growth even faster.”
Nic Humphries, Senior Partner and Head of the Saturn funds at Hg, said, “We have spent well over 20 years with a strong focus on enterprise software. As a result we have followed IFS’s success for several years and recognise it as a very high-quality cloud business. Its consistent performance and growth is a result of a compelling and differentiated proposition, built by a strong management team led by Darren. Both IFS and WorkWave offer very strong cloud products in verticals which are growing rapidly and we therefore see a clear runway for sustained growth for the businesses.”
Per Franzén, Partner and Head of EQT Private Capital, said, “Having led EQT VII’s buyout of IFS from Nasdaq Stockholm back in 2015, I am truly impressed by the strong positions the Companies hold today. IFS has transformed from a Northern European-focused software vendor into a global provider of cloud-based software solutions with a clear leadership position within its segments. I believe we have only seen the beginning of IFS’s and WorkWave’s growth trajectories, and I am pleased to welcome Hg as a new co-investor as the Companies enter a new chapter in their exciting journeys.”
The transaction is subject to customary conditions and approvals and is expected to close during Q3 2022.
Arma Partners acted as exclusive financial adviser to the sellers on this transaction alongside White & Case (legal), Kirkland & Ellis (legal) and PwC (financial and tax).
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