Case Study: Human Capital Investment Group
We backed:
Tim Cook
Graphite Capital made an offer to purchase HCIG for £90m which was at an 8.6x multiple of the £11.4m EBIT; this realised £75m for the investors and £15m for management (with the management share being 50% paid and 50% rollover).
The business continues to do well; post-acquisition from Graphite Capital it was rebranded as nGAGE and is now projected to do £17m EBIT in the current year.
Whilst we can sell individual businesses regularly, the typical valuation multiple ranges at 5.5x to 6.5x of earnings. However, where it is possible to create a group of size or sell individual business in a sub-portfolio with substance and scale, an exit can be realised with an enhanced multiple, as achieved with HCIG.
Launch
Scaling
Exit
Together, everyone achieves more.
We invested in a collection of JVs and existing businesses to create HCIG.
At the point of sale, HCIG’s investment portfolio comprised 7 JVs and 3 existing businesses, generating £50m recruitment net fee income and delivering annual EBIT profit of £11.4m.
An investment bank was hired to find a new investor for the newly created group; Graphite Capital, a London-based private equity firm, had previously acquired Alexander Mann so had high respect for James Caan and the quality of businesses that he has the reputation for building.
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