Hg, the Manager of HgCapital Trust plc ("HgT"), today
announces an investment in Ncontracts.
Ncontracts, a leading provider of integrated compliance, risk,
and vendor management solutions to the financial services industry,
also announced today that it has acquired Venminder, a unified
platform for managing third-party risk.
Hg
has bought out prior Ncontracts shareholder Gryphon Investors, as
well as prior Venminder shareholders. The terms of the transaction
are not disclosed.
HgT will invest approximately £30.7 million in Ncontracts,
with other institutional clients of Hg investing alongside HgT
through the Hg Genesis 10 Fund.
HgT, whose shares are listed on the London Stock Exchange,
gives private and institutional investors the opportunity to
participate in all Hg's investments.
Note that these figures only relate to HgT's share of Hg's
overall investment in Ncontracts.
HgT's liquid resources available for future deployment
(including all announced transactions, and the undrawn balance on
the bank facility) are estimated to be £466 million (19% of the
estimated 30 June 2024 NAV of £2.4 billion).
The investment will reduce HgT's outstanding commitments to
invest in Hg transactions to approximately £683 million (28% of the
estimated 30 June 2024 NAV).
Ncontracts acquires Venminder
via Hg buyout
- Ncontracts announces the
acquisition of Venminder to broaden its governance, risk and
compliance solutions capabilities.
- Hg, a leading investor in
software and services businesses, has become a new investor in the
combined business, backing Founder and CEO, Michael
Berman.
- Gryphon Investors, a leading
middle-market private equity firm, has completed a full exit of
Ncontracts.
BRENTWOOD, Tenn., September
4, 2024 -- Ncontracts,
a leading provider of integrated compliance, risk, and vendor
management solutions to the financial services industry, announced
today that it has acquired Venminder, a unified platform for
managing third-party risk.
Simultaneously with this
transaction, Hg has bought out prior Ncontracts shareholder Gryphon
Investors ("Gryphon"), as well as prior Venminder shareholders. Hg
is a leading investor in software and services businesses and is
backing Founder and CEO, Michael Berman, to lead the combined
business, which promises to deliver more value to customers via
these expanded capabilities.
Acquiring Venminder gives Ncontracts
more depth and expertise in third-party risk management, further
enhancing its position as a software-as-a-service (SaaS) and
knowledge-as-a-service (KaaS) leader in enterprise risk
management. The investment from Hg brings resources and
expertise, continuing to strengthen Ncontracts as a leader in
governance, risk and compliance ("GRC") software solutions for
banks, credit unions, mortgage companies, fintechs and registered
investment advisors, as they grapple with increased risks and
regulatory scrutiny.
"We are excited to join forces with
Venminder," said Michael Berman,
Ncontracts Founder and CEO. "With our teams coming together
to help reduce risk, improve compliance and
control costs, we will continue to strengthen the financial
industry and the communities they serve. With the investment and
support from Hg, we are well positioned to continue our rapid
growth. Gryphon has been a valuable
partner, and I want to thank their outstanding team of operating
partners, operating advisors and investment
professionals."
"Uniting Venminder and Ncontracts
will bring tremendous value to our customers," stated James Hyde, Venminder's CEO.
"This strategic partnership extends beyond third-party risk
management, propelling Venminder into the broader integrated risk
and compliance space. By combining our strengths, we are poised to
deliver even more comprehensive and innovative solutions to our
clients and the broader market. Our unwavering commitment is
to continue to support our clients by guiding them through the
complex landscape of third-party risk."
Ncontracts has been named in the
prestigious Inc. 5000 list of fastest growing private companies in
America for the sixth consecutive year in 2024. This transaction
will grow Ncontracts' customer base further to over 5,000
customers. The investment and acquisition demonstrate Ncontracts'
commitment to continued growth from both an organic and inorganic
perspective.
Alan Cline, Head of North America at Hg, said:
"We see Ncontracts swiftly becoming a 'gold
standard' provider of highly automated, AI-enabled, integrated
software solutions for the financial industry. The merger with
Venminder creates a compelling platform with a comprehensive
product suite that can deliver significant value to
customers."
Alexander Johnson, a Director at Hg
added: "We're excited to partner
with Michael Berman as he continues to lead and scale the company
for its next stage of growth."
Jon
Cheek, Partner & Co-Head of the Software Group at Gryphon,
said: "We are delighted to have
completed a complex transaction that significantly transforms
Ncontracts and positions it to continue to thrive. Through a
combination of organic and inorganic growth strategies, Ncontracts
has more than quadrupled in size since Gryphon originally invested
in 2020. With its comprehensive suite of products meeting the
continued demand for sophisticated financial services governance,
risk and compliance management tools, the company is poised to
continue that aggressive growth going forward."
Gryphon sees continued attractive
opportunity for new platform investments in the GRC sector and
retains its investment in separate portfolio company RegEd, a
leading provider of enterprise regulatory compliance solutions to
insurance companies and financial services firms.
Terms of the acquisition were not
disclosed.
Raymond James served as the lead
financial advisor to Gryphon, with Atlas Technology Group also
advising Gryphon; Kirkland & Ellis acted as Gryphon's legal
advisor. William Blair served as exclusive financial advisor to
Venminder. Choate Hall & Stewart, LLP served as legal
counsel to Venminder. Goldman Sachs served as financial
advisor to Hg; Latham & Watkins served as Hg's legal
advisor.
For further details:
Hg
Tom Eckersley
+44 (0)208 148 5401
HgCapital Trust
George Crowe
+44 (0)20 8396 0930
Brunswick
Azadeh
Varzi
+44 (0)207 404 5959
Hg@brunswickgroup.com
About HgCapital Trust plc
HgCapital Trust plc, whose shares
are listed on the London Stock Exchange (ticker: HGT.L), gives
investors exposure through a liquid vehicle to a portfolio of
high-growth private companies in the software and services sector.
The selection of new investments and creation of value in these
businesses are managed by Hg, an experienced and well-resourced
private equity firm with a long-term track record of delivering
superior risk-adjusted returns for its investors. For further
details, please see www.hgcapitaltrust.com.
The contents of the Hg, HgCapital Trust, Ncontracts, Venminder
and Gryphon's websites are not incorporated into, and do not form
part of, this announcement.
