News

Hg announces an investment in BrightPay

10/09/2018 10 September: Hg today announces that it has agreed a first investment of Transition Capital in BrightPay, a provider of Accounting and HR payroll software to SMEs in Ireland and the UK. The terms of the investment are not disclosed. Hg’s structured minority investment strategy will fund the investment in BrightPay. Transition Capital offers privately-owned businesses an attractive alternative to a minority equity sale, through structured equity, which gives entrepreneurs access to the support of Hg and its network, whilst retaining control of their business. Based near Dublin, BrightPay provides easy-to-use and cutting-edge software solutions to enable SMEs to manage payroll, supported by excellent customer service. BrightPay’s software is used by over 120,000 employers across the UK and Ireland under two brands, BrightPay and Thesaurus Software. BrightPay’s business of Accounting and HR payroll software is a very familiar sector to Hg and represents the 10th investment in businesses within this space. Payroll in Ireland is scheduled to undergo significant change from January 2019, as Ireland rolls out PAYE modernisation, which will require employers to report PAYE in real time to the Irish Revenue Commissioners (“Revenue”). BrightPay has invested significantly ahead of this change to prepare to support Irish SMEs through this transition. Peter Miholich, Director at Hg, said: “We have been really impressed by the dedication of the BrightPay team to delivering great software and outstanding service to their customers. We look forward to partnering with Paul, Ross and the team to take BrightPay to the next stage of its development, adding our experience and strong track-record of working with successful businesses in Accounting and Payroll software.” Paul Byrne, Founder and Managing Director at BrightPay, said: “Hg is a hugely credible investor in this sector and it’s great to secure an investment from a firm who both knows our market and has the experience to help us develop the business.”

Hg August Highlights

01/09/2018 Welcome to our program of monthly digests, designed to keep you updated with news from Hg and our network of portfolio companies. If you would like to subscribe, please email us. Catch up here  

Hg announces investment into Allocate Software from Hg8 Fund

30/08/2018 30 August 2018. Hg today announces an investment in Allocate Software (“Allocate”), a leading international provider of workforce solutions to the healthcare, defence and maritime sectors. Allocate supports the operational and administrative needs of healthcare professionals in all healthcare settings as well as defence and maritime staff globally. In healthcare Allocate is enabling the delivery of safe and effective care at optimal cost, by helping organisations to have the right people in the right place at the right time. Allocate serves the largest public and private healthcare institutions around the world, with over 800 clients and over a million staff rostered daily - over 700,000 of which are now managed on the ‘Optima’ software-as-a- service (SaaS) platform. In the defence and maritime sectors, Allocate’s Dynama Oneview platform is supporting some of the most prestigious organisations globally helping them make decisions and control costs with time-based management of people, resources and operations. Allocate has 500 employees, with over 190 working in the R&D and product management functions. It is headquartered in the UK. Hg initially invested in Allocate at the end of 2014, completing a public-to-private transaction from the London Stock Exchange. In April 2018, Hg announced the sale of Allocate to Vista Equity Partners (“Vista”). Recognising Hg’s considerable expertise in healthcare software and its pan-European footprint, Vista provided Hg with an option to reinvest in the next phase of Allocate's growth. Hg is pleased to announce that it has exercised that option to re-invest and partner with Vista by acquiring a co-controlling stake in Allocate. This will represent the third investment made by the Hg8 Fund, bringing the fund to c. 27% invested. Jean-Baptiste Brian and David Issott, Partners at Hg, said: “Hg invests in businesses that demonstrate compelling long-term growth potential and we are looking forward to working with the Allocate team, continuing to deliver the company’s ambitious plans. This opportunity to invest is a testament to the further potential we see with Allocate and our positive relationship with the company. Healthcare technology is a core investment area for Hg: Allocate is the third investment in the cluster announced this year, after MediFox and Rhapsody.” “We are excited to continue to work with the Allocate team to grow their business and provide their platform and technology to even more healthcare providers and professionals across the globe,” said Alan Cline, Principal and Co-Head of the Foundation Fund at Vista. “Hg’s re-investment in Allocate is an affirmation of Allocate’s strategy and growth potential moving forward, and we are thrilled to have Hg as an investment partner.” The terms have not been disclosed. Spurrier Capital Partners served as financial advisor to Vista.

Syneos Health™ acquires Kinapse

20/08/2018 Syneos Health™ acquires Kinapse to further enhance end-to-end capabilities  Addition of Market Leading Advisory and Operational Solutions Provider Increases High-Value Offerings and Expands Operational Scale in Key Growth Markets https://kinapse.com/Syneos-Health-acquires-Kinapse RALEIGH, N.C. – August 20, 2018 – Syneos Health, Inc. (Nasdaq:SYNH) (“Syneos Health” or “the Company”), a leading biopharmaceutical solutions organization, today announced the acquisition of Kinapse, a market leading advisory and operational solutions provider to the global life sciences industry, from Hg, a specialist investor based in the U.K. Established in 2005, Kinapse delivers services across the clinical and commercial lifecycle, and will further enhance Syneos Health’s ability to provide customers with end-to-end solutions to accelerate time to market. Kinapse’s capabilities expand Syneos Health’s regulatory, safety and pharmacovigilance consulting and operations in the post-market arena – outsourcing areas expected to experience double-digit growth. Additionally, the acquisition deepens the scale and scope of Syneos Health’s clinical trial transparency, medical writing and quality operations and consulting capabilities in the areas of R&D and clinical operations, medical affairs, market access and quality and compliance. Kinapse works with small to mid and large biopharmaceutical companies — including many of the top 20 global biopharma companies — and has more than 600 employees across the United Kingdom, India and the United States. The acquisition increases Syneos Health’s Asia Pacific operational and delivery capabilities and doubles the Company’s consulting footprint in Europe. Kinapse operations will be integrated into Syneos Health’s award-winning consulting business, a business which drives connections between Syneos Health’s core clinical and commercial offerings to optimize product launch and commercialization results. “As customers increasingly face risk, competition and rising development costs, the innovative, technology-enabled solutions provided by Kinapse are seeing increasing demand,” said Alistair Macdonald, Chief Executive Officer of Syneos Health. “Through this combination we continue to inject new and enriched high-value solutions into the industry’s only end-to-end offering, unlocking value for all of our biopharmaceutical customers. Additionally, with Kinapse’s growth, recurring revenue streams and new cross-selling opportunities, we’re poised to further strengthen our Commercial business by integrating their services into more comprehensive offerings.” “We’ve been following Syneos Health as the Company has forged a new model for accelerating therapies to market, and we look forward to adding further depth to its end-to-end offering. We see growth opportunities driven by the integration of our solutions and the ability to tap into Syneos Health’s broad customer base,” said Dawn Marriott-Sims, Executive Chairman of Kinapse. “On behalf of the Kinapse management team, I want to extend my thanks to our dedicated employees for their tireless work that has made this combination possible, as well as Hg, whose support as an investor has been transformational over the last several years.” Macdonald added, “This combination is an ideal strategic and cultural fit. We welcome the Kinapse team to the Syneos Health family and look forward to bringing more innovative services to our customers.” Syneos Health is funding the transaction through cash on hand. Financial terms of the transaction were not disclosed. The Company expects the transaction to be accretive to its earnings and remains committed to achieving a net leverage ratio of approximately three times by the end of 2019. The Company reaffirms the 2018 guidance range provided on August 2, 2018.

Hg Invests in Orion Health Rhapsody and Population Health Businesses

03/07/2018 All figures in NZD AUCKLAND, New Zealand - 3 July 2018 - Orion Health Group Limited (NZX:OHE/ASX:OHE, “Orion Health” or the “Group”) today announces that it has reached agreement in relation to Orion Health’s Rhapsody and Population Health businesses with private equity technology investor Hg (“the Hg Transaction”). In April 2017, the Group announced a strategic review focused on long-term shareholder value, including the evaluation of any partnerships or minority investments to allow Orion Health to achieve its potential. The conclusion of this lengthy and comprehensive review has recognised that the Group’s three businesses would each benefit from different funding, investment backing and partnerships and that it was in the best interests of the Group and its shareholders to consider options individual to each business. The Group has been working with Hg for a number of months and has now concluded an agreement which the Board is pleased to set out below. Summary: • The agreement is for entities managed by Hg to acquire majority ownership of Orion Health’s Rhapsody business (“Rhapsody”) and to invest in Orion Health’s Population Health business (“Population Health”). • Hg is a specialist technology investor committed to helping build global businesses with funds of c.£10 billion under management. • The Hg Transaction implies a $255 million enterprise value of Orion Health. • Following completion of the Hg Transaction, Orion Health will undertake a share buyback offer at an estimated price range of $1.24-$1.29 per share (the “share buyback offer”), with the final offer price dependent on Orion Health’s available cash immediately following completion taking into account transaction costs and working capital adjustments in relation to the Rhapsody transaction. Shareholders will have the option to accept the share buyback offer in respect of all or a specified proportion of their Orion Health shares. • The bottom of the estimated buy back price range represents a premium of 46% to the closing price per Orion Health share of $0.85 on 2 July 2018 and 55% to the volume weighted average trading price over the last 20 trading days. • The Hg Transaction is subject to a number of conditions, including approval of the Hg Transaction and the share buyback offer by Orion Health’s shareholders. A notice of meeting describing the Hg Transaction and the share buyback offer will be circulated to shareholders. The independent directors have commissioned an independent report from KordaMentha in respect of the Hg Transaction and the share buyback offer, which will be provided to shareholders with the notice of meeting. ........ Next Chapter for Orion Health “This investment provides Orion Health with a tremendous opportunity to deliver on our vision for customers, our people and for the healthcare sector,” said Ian McCrae, Founder and CEO, Orion Health. “We received strong interest in Orion Health’s business throughout the strategic review process and the Board and I believe that Hg is the right partner to accelerate the expansion of Rhapsody and support our vision for Population Health.” Healthcare technology is a core investment area for Hg, having recently completed a number of transactions across the sector. This investment will be made from Hg’s Mercury 2 Fund. “Hg has been researching the theme of interoperability and population health management in healthcare IT over many years,” said David Issott, Partner, Hg. “We believe this is a key global growth theme backed by substantial market funding and resources. Rhapsody provides fantastic products and services for this market and we look forward to partnering with the team at Rhapsody to maximise its potential across the globe. We are also excited to work with Ian and the team to realise the full potential of the Population Health business.” Orion Health built the first Rhapsody integration engine in the late-1990s quickly becoming one of the most recognised interoperability platforms for healthcare organisations today. The combination of Rhapsody’s global team and Hg’s resources will extend Rhapsody as a leader in the interoperability platform space, building on both Rhapsody’s world class technology and highly rated customer service. Philippe Houssiau, an experienced global technology executive, will step in to lead the Rhapsody business and will join the new board of Population Health from closing. Philippe has broad experience in leading healthcare businesses, consulting and start-ups, and is formerly CEO of Agfa Healthcare, CEO of Alliance Medical and a Senior Partner with PwC. “As the healthcare sector evolves, so too has Orion Health. We recently restructured our teams into three businesses focused on Rhapsody, Population Health and Hospitals, repositioning Orion Health around market potential and focusing dedicated teams to support customers, improve operating performance and drive growth,” said McCrae. “We remain committed to the ongoing success of Rhapsody and supporting customers across our entire Orion Health business.” Orion Health believes the biggest advances in healthcare technology will come from advanced analytics and better dataflow to address critical issues within the sector. In the face of growing and aging populations and the rise of chronic diseases, health systems the world over are under enormous strain. The focus of Orion Health’s Population Health and Hospitals business is to help the sector optimise healthcare budgets and address the transformation necessary in the healthcare industry. “This injection of capital will advance Orion Health’s businesses to reach their full potential over time. For our Population Health business, it will help strengthen our position as a market leader, and for our Hospitals business, it will further support its growth,” said McCrae. For more details: https://www.nzx.com/announcements/320296

Hg invests in IT Relation

14/06/2018 14 June 2018. Hg today announces that it has agreed to invest in IT Relation, a leading Danish supplier of managed IT services to small and medium sized enterprises (SMEs). Hg will acquire a majority stake in IT Relation from Adelis Equity Partners. The closing of the transaction is subject to regulatory approval and the terms are not disclosed. Founded in 2003, IT Relation provides services which allow SMEs to move their IT infrastructure and operations into the cloud, as well as providing end user support and consulting as part of a full-service IT offering. The company has more than 450 employees supporting thousands of customers and tens of thousands of users in Denmark and around the world. This investment is consistent with Hg’s focus on SME Technology Services in Europe, with other activity in this sector including investments in Zitcom (2015) and DADA (2017), both providers of online hosting services to SMEs. Hg will support the management team to build a clear industry champion based on IT Relation’s excellent customer service and operating platform. Nick Jordan, Partner and Jonas Samlin, Principal, at Hg, said: “Henrik Kastbjerg and the IT Relation management team have built an exceptional business addressing the need for SMEs to operate their mission-critical IT in the cloud. We look forward to partnering with the business in the next phase of growth in Denmark and internationally.” Henrik Kastbjerg, CEO of IT Relation said: “It has been a great journey with Adelis and now we are very excited about the next phase with Hg. Hg has a proven track record of investing in and developing tech and software companies and can support our further growth in Denmark as well as internationally.”