HgCapital invests in HR software provider P&I

Hg, the manager of HgCapital Trust, announced an investment in Germany-based cloud-based HR software provider Personal & Informatik (P&I) on Monday, acquiring the holding from funds advised by private equity firm Permira for an enterprise value of €2bn.

The FTSE 250 firm said Permira funds remained invested in P&I with a “substantial” minority stake.

It said the transaction would represent the fourth investment from the Hg Saturn 1 Fund, which had its first close in early 2018 and was focussed on software businesses with enterprise values of more than £1bn.

Hg-managed funds would become the majority shareholder in the business, and terms of the transactions were not disclosed.

HgCapital Trust would invest around £37.7m in P&I, with other institutional clients of Hg investing alongside the company through the Hg Saturn 1 Fund.

“Based on the 30 September net asset value, including all announced transactions and the proceeds from the issues of equity in November and December, following completion of the transaction the pro-forma net asset value of the trust is expected to be £1.02bn, or 251.8p per share,” the board said in its statement.

“This transaction would value the company's existing investment in P&I through the Hg Genesis 7 Fund and associated co-investment at £20m.”

HgCapital Trust said its liquid resources available for future deployment, including all announced transactions, the interim dividend paid on 25 October and the issues of equity in November and December, were estimated to be £125m, or 12% of the pro-forma net asset value of £1.02bn.

In addition, the company said it had access to an £80m standby facility, which was currently undrawn.

The investment would reduce the company's outstanding commitments to invest in Hg transactions over the next two years to approximately £269m.

At 0926 GMT, shares in HgCapital Trust were up 0.3% at 252.75p.