Today, Value4Capital announced that it has agreed the sale of its portfolio company home.pl to United Internet’s (Xetra: UTDI) subsidiary 1&1 Internet SE, subject to anti-monopoly clearances.
Home.pl is a leading provider of cloud-based services in Poland and Central Eastern Europe focused on small and medium businesses. home.pl has the largest service range in the Polish market including web hosting, domains, business applications and cloud-based products.
A V4C-led consortium including Swiss-based Alpha Associates invested in home.pl in February 2012 in a transaction where it took a controlling interest alongside the company’s original founders and its Chief Executive Officer, Marcin Kuśmierz. The deal was also backed by Syntaxis Capital as mezzanine provider and included senior debt facility from mBank.
During the holding period, home.pl achieved a significant increase in sales and profitability. V4C also orchestrated the acquisition of rival AZ.pl in late 2013, further consolidating home.pl’s market leadership. Piotr Misztal, the partner at V4C responsible for the investment, commented: “home.pl is a strategic as well as a financial success. It has become one of the most innovative companies in the sector, expanding its product offering and improving the customer experience while significantly growing EBITDA. The interest we saw from both strategic and financial buyers during the sale process demonstrates the attractiveness of the company and the strong prospects for further growth in the still underpenetrated Polish market.” This significant growth and operational transformation during V4C’s ownership resulted in a 3.4x cash return and an over 40% IRR on this investment.
Henry Potter, the Partner responsible at Alpha Associates commented: “This is one of those rare cases where everything went as expected and there were no bumps in the road. 3.4x was at the upper end of our return expectations. I can only compliment the home.pl management and the V4C team on the excellent execution of the plan.”
ING Bank acted as financial advisor to the sellers, EY provided Financial and Tax Due Diligence, while PWC acted as commercial advisor. CMS Cameron McKenna acted as legal advisor for V4C.
Piotr Misztal and Rafał Ałasa were responsible for this investment on V4C side.