Private Equity Deals: Francisco Partners Acquires Macrobond
Introduction
Private equity firm Francisco Partners has recently made a significant acquisition in the financial data industry. The firm has agreed to acquire Macrobond, a leading financial data provider, for nearly 700 million euros. This deal is the latest in a series of private equity transactions that have attracted substantial investment in recent years. With the acquisition of Macrobond, Francisco Partners aims to further strengthen its presence in the financial data market and capitalize on the growing demand for reliable and accurate financial information.
The Deal
Francisco Partners has emerged as the successful bidder in the acquisition of Macrobond, outbidding other private equity groups and strategic buyers. The deal involves the purchase of Macrobond from its competitor private equity company, Nordic Capital. The transaction is estimated to be worth nearly 700 million euros, highlighting the value and potential of financial data providers in the current market climate.
About Macrobond
Founded in 2008 in Sweden, Macrobond has established itself as a trusted provider of financial data and technology services. The company serves more than 800 banks and asset managers worldwide, offering a comprehensive range of data and analytical tools. With its subscription-based business model, Macrobond has generated predictable and steady revenues, making it an attractive investment opportunity for private equity firms.
Growth in Financial Data Industry
The acquisition of Macrobond by Francisco Partners is part of a larger trend in the financial data industry. In the past 18 months, there have been several significant deals involving financial data providers. For instance, Reorg, a distressed debt and bankruptcy information provider, was acquired by buying group Permira for approximately $1.3 billion. Similarly, Morningstar acquired Leveraged Commentary and Data, a debt financing transaction reporting company, from S&P for $650 million. These deals highlight the increasing demand for financial data and the potential for substantial returns on investment.
Nordic Capital’s Investment
Nordic Capital’s acquisition and subsequent sale of Macrobond demonstrate the firm’s ability to identify valuable investment opportunities. By backing Macrobond in 2018, Nordic Capital generated significant returns, making approximately six times its initial investment. This success illustrates the appeal of financial data providers and the potential for substantial profits in this sector.
Expansion and Market Position
One of the key motivations behind Nordic Capital’s acquisition of Macrobond was to aid the company in expanding its market position. Nordic Capital has made substantial investments in Macrobond’s technology and data offerings, differentiating it from competitors and enabling it to penetrate new markets in Asia and North America. These strategic moves have strengthened Macrobond’s position as a leading financial data provider and made it an attractive target for private equity firms like Francisco Partners.
The Private Equity Landscape
The acquisition of Macrobond by Francisco Partners reflects the broader dynamics within the private equity industry. Private equity groups are under increasing pressure to generate returns for their institutional investors, leading to a heightened focus on investment exits. The Macrobond sale also stands out as a rare transaction between private equity firms, as the volume of such deals has declined in the current market environment. The volatility of markets and rising interest rates have made asset valuation and financing transactions more challenging, resulting in fewer inter-firm transactions.
About Francisco Partners
Francisco Partners is a US-based private equity firm with a track record of successful investments across various industries. The firm has a strong focus on technology companies and has built a reputation for identifying promising opportunities and driving growth. The acquisition of Macrobond aligns with Francisco Partners’ investment strategy and underscores its commitment to the financial data sector.
Conclusion
The acquisition of Macrobond by Francisco Partners represents a significant development in the financial data industry. This deal highlights the growing demand for reliable and accurate financial information and the potential for substantial returns on investment in the sector. As private equity firms continue to seek profitable opportunities, the financial data industry is likely to witness further consolidation and expansion. Investors and market participants should closely monitor these developments to capitalize on the opportunities presented by the evolving landscape of private equity deals.
Summary
Francisco Partners has agreed to acquire Macrobond, a leading financial data provider, for nearly 700 million euros. This deal reflects the growing demand for financial data and the potential for substantial returns on investment in the sector. Nordic Capital’s successful investment in Macrobond and subsequent sale demonstrate the value and potential of financial data providers. The acquisition by Francisco Partners aligns with its investment strategy and highlights the firm’s commitment to the financial data industry. As the private equity landscape evolves, market participants should closely monitor developments in the financial data sector to seize promising opportunities.
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US private equity firm Francisco Partners has agreed to buy financial data provider Macrobond for nearly 700 million euros, the latest deal in an industry that has attracted billions of dollars from investors in recent years.
Francisco Partners is acquiring the business from its rival private equity Nordic Capital company, according to people familiar with the matter. The US-based firm beat off competition from other private equity groups and strategic buyers.
Founded in Sweden in 2008, Macrobond provides financial data and technology services to more than 800 banks and asset managers, according to its website.
Nordic Capital made about six times its money after it first backed Macrobonds in 2018, showing the returns on offer to investors attracted by the typically predictable subscription-based revenues of financial data providers.
Over the past 18 months, financial data providers Reorg and Leveraged Commentary and Data have also exchanged hands in big deals.
Buying group Permira took a majority stake last August in Reorg which valued the distressed debt and bankruptcy information provider at about $1.3 billion.
This came months after data group Morningstar acquired Leveraged Commentary and Data, which reports debt financing transactions, from S&P in a deal worth $650 million.
Nordic Capital bought Macrobond with the aim of helping it expand its market position.
“We have made significant investments in the business’s technology, as well as a strong focus on building its unique data set and differentiating it from the competition,” said Emil Anderson, partner at Nordic Capital.
Nordic capital he also helped propel the company into new markets in Asia and North America. Macrobond employs 230 people in six offices in Europe, Asia and North America.
The private equity group is exiting its investment at a time when the broader acquisition industry is under pressure to return capital to the institutional funds that back it.
The Macrobond sale also marks a rare sale of an asset between private equity groups. The volume of such deals has plummeted this year in Europe as tumultuous markets have made asset valuation more difficult, while rising interest rates have made financing transactions more expensive.
Stockholm-based Nordic Capital has invested €22 billion in more than 130 investments since its founding in 1989, including billions in technology and payments companies. It has raised €9 billion for its most recent fund.
The Macrobond transaction is expected to close by the end of August.
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