By Ramone Param, Director, Equiteq
- Notable deals included Capgemini’s acquisition of LiquidHub, Veritas Capital’s acquisition of PwC US’s government consulting business, Valtech’s acquisition of True Clarity and Livingbridge-backed Catalyst Development’s acquisition of Knadel.
- Equiteq advised Ducker Worldwide on its sale to Frontier Strategy Group and Axentel Technologies on its sale to Park Place Technologies.
- The Equiteq Consulting Share Price Index fluctuated over the month and ended the period broadly flat.
Capgemini acquires digital customer experience firm LiquidHub
Target: LiquidHub is a US-headquartered global customer engagement company that help companies improve customer experience and drive growth.
Buyer: Capgemini is a France-headquartered global leader in consulting, technology services and digital transformation.
Deal Value: EUR400m (1.8x FY17 Revenue)
In October of last year, The Times of India reported that Cognizant and Apax Partners were among shortlisted suitors for a potential acquisition of LiquidHub for as much as $600m. At the beginning of February, Capgemini announced that it would acquire the business for almost two times its revenue.
LiquidHub was founded in 2000 and raised $52.54m of Series B venture funding from ChrysCapital in 2014. The investment put the company’s pre-money valuation at $116.67m and enabled it to make investments in its growth including completing a number of acquisitions over 2016 and 2017. The company’s shareholder includes key management and investor ChrysCapital.
Veritas Capital acquires PwC’s US public sector business
Target: PwC US’ public sector business consists of c.1,500 partners and staff and advises federal, state and local governments, as well as multilateral agencies.
Buyer: Veritas Capital is a private equity firm that invests in businesses that offer critical products and services, typically technology or technology-enabled solutions, to government and private sector customers globally.
PwC’s government consulting business has worked on high-profile lucrative engagements with agencies such as the Department of Defense, Homeland Security and Veterans Affairs. The sale is expected to enable PwC to focus on the growth of other parts of its advisory business and allow it to pursue more business in auditing government agencies. This latter business is currently limited due to professional standards which cap consulting services that audit firms can provide to agencies.
In December of last year, Reuters reported that PwC was exploring the sale of its government consulting practice and that it could fetch c.$500m. The report stated that the unit’s pretax earnings are expected to be over $60m this year from about $50m in 2017. The report highlighted Veritas Capital and Chicago-based Madison Dearborn Partners as potential bidders.
Valtech acquired software development consultancy True Clarity
Target: True Clarity is a UK-based software development firm specializing in DevOps, ecommerce, big data, mobile and cloud services and adjacent solutions.
Buyer: Valtech is a UK-based global digital transformation specialist with backing from Belgium investment manager Verlinvest.
True Clarity marks Valtech’s first investment of the year, after closing three digital marketing acquisitions across the globe in 2017. The deal is expected to enable the buyer to increase its capabilities in ecommerce, particularly as it relates to platforms like Sitecore. True Clarity will strengthen Valtech’s presence in the UK and its relationships with major clients like EasyJet, Dyson and ASOS.
In 2016 investment firm Verlinvest through its portfolio company SiegCo acquired a majority stake in Valtech. The investment was envisaged to enable Valtech to become the European leader in digital optimization.
Livingbridge-backed Catalyst Development acquires investment management firm Knadel
Target: Catalyst Development is a UK-based specialist financial markets consultancy backed by private equity firm Livingbridge.
Buyer: Knadel is a boutique business and technology consultancy focused on the investment management industry.
In October of last year, Catalyst Development raised capital from Livingbridge. The funding would enable the business to address the variety of issues facing the financial sector and help Catalyst grow its client base through a mixture of organic growth and M&A.
Knadel marks Catalyst’s first acquisition following this investment and is expected to precede more as the business looks to double revenue over its next financial year. Knadel was founded in 2009 and has since worked on almost 400 engagements with over 120 clients. It has offices in London and Jersey and supports clients globally.
Selected Consulting M&A announced in February:
Equiteq Consulting Share Price Index:
This article has been compiled using our daily activities in the industry that provide us with unique market intelligence, along with unverified data from various third-party information sources.