Just days after Zurich-based Staff Finder, Europe’s #1 on-demand marketplace for temporary staffing, raised €20 million in a growth equity funding round led by One Peak Partners and Goldman Sachs (NYSE: GS) Private Capital, and after Hamburg-based Seafort Advisors acquired German temporary employment company Die Jobmacher, the continent’s private equity staffing sector investors are reacting to the new competitive landscape.
European buyout house CVC Capital Partners is reportedly seeking an exit from Dutch HR software and services provider Raet, according to Reuters.
The private equity firm is working with Rothschild on a potential deal, which could value the business at between 376 million euros to 564 million euros ($619.10 million), or eight to twelve times its 2014 earnings, sources said.
Raet, which employs around 1,000 people, is the Netherlands’ biggest provider of human resources in the IT field, with turnover of 147.9 million euros, according to CVC’s website.
The business had core earnings (EBITDA) of 47 million euros in 2014 and is already being eyed by other private equity firms, one of the sources said.
CVC and Rothschild declined to comment.
CVC bought Raet in 2011 for an undisclosed sum. But media reports at the time said its then owners, Advent and Taros Capital — a spinout from AlpInvest Partners — were seeking around eight times EBITDA for the business, or about 400 million euros. Another source said companies in the industry could fetch as much as 12 times EBITDA.
Raet’s software services include recruitment and workforce management, as well as supporting payroll administration.
The sector has attracted private equity interest over the years with varying degrees of success. In 2013 HG Capital purchased Germany’s P&I for an enterprise value of 438 million euros.
U.S. buyout firm KKR’s (NYSE:KKR) British HR software company, Northgate NGA, was taken over by lenders in November last year.
CVC also has stakes in Spanish clothing chain Cortefiel and Formula One. The buyout firm has been exploring new ways to obtain decent returns, as private equity finds itself facing competition from the likes of pension funds and prices are pushed further higher due to a scarcity of assets on the market.
In February CVC raised $1 billion for a tech-focused growth fund. Late last year it made the first purchase from its Strategic Opportunities platform, designed for investments over a longer-term horizon.
(Reuters reporting By Freya Berry, additional reporting by Arno Schuetze; editing by Sophie Sassard and Susan Thomas)
Raet is the Netherlands’ largest service provider in the field of IT solutions for Human Resources and outsourcing of HR processes. Raet’s HR-portal Youforce offers customers and their employees a full range of HR software solutions to help drive corporate profits. Built around an employee-centric model, Raet’s solutions support their ambition to help organization’s remain competitive.
The company’s cutting edge technology Youforce, based on ‘Software as a Service’ (SaaS), optimises HR processes such as absence management, recruitment, talent management and workforce management, as well as supporting basic HR and payroll administration. It makes them available anytime, anyplace, anywhere and on any de-vice. Easy access and use via a web browser provides “always on” interaction, making the system more effective both for employees and managers looking for timely, accu-rate data on the performance of themselves as well as their staff. This enables compa-nies to implement business-oriented HR.
As the main sponsor of the NVP (the industry association for Personnel Management and Organisational Development), Raet also contributes to the development of the pro-fession. Raet currently has approximately 1.000 employees and provides services to 10.000 clients with a total of 1.6 million employees, which makes Raet the leader in the Dutch market. Raet is now bringing these innovative mobile solutions to the international market.
Headquartered in Luxembourg, CVC Capital Partners is one of the world’s leading private equity and investment advisory firms. Founded originally in 1981 as the European arm of Citicorp Venture Capital, the CVC Group today employs some 300 people throughout Europe, Asia and the US. The firm was spun out from Citicorp in 1993, as an independent private equity firm. The CVC team’s local knowledge and extensive contacts underpin a proven track record of over 30 years of investment success. CVC manages capital on behalf of over 300 institutional, governmental and private investors worldwide, having secured commitments of more than US$71 billion in private equity, credit and growth funds.