Private equity firm Thomas H. Lee Partners (THL) has agreed to acquire a majority stake in Standish Management in a deal that values the U.S.-based fund administrator at about $1.6 billion, including debt, people familiar with the matter said.
THL prevailed in an auction for the company over other private equity firms because its bid was favored by Standish’s management, the sources said.
The management team and other Standish employees, who collectively own 65% of the company, will retain a 45% stake, with THL holding the remainder, the sources added.
London-based investment firm Vitruvian Partners, which first invested in Standish in 2020, is cashing out, the sources added.
The sources spoke on condition of anonymity as the deal discussions are confidential.
THL declined to comment. Standish representatives did not respond to a request for comment, while Vitruvian could not be reached for comment.
Private equity firms see fund administrators as attractive investments, given their predictable income streams and the ability to grow these companies through debt-fueled acquisitions.
Reuters reported earlier this month that THL was competing with other buyout firms, including Blackstone Inc and TPG Inc, for the Standish deal.
Led by CEO Robert Raynard, Standish provides administrative services such as accounting and reporting to investment funds.
The Boston, Massachusetts-based company administers about $450 billion of assets and has more than 850 employees across offices in the United States and Europe.
Around 200 employees of Standish own a stake in the company, according to its website.
THL focuses on investments in financial services, healthcare and technology. Its latest flagship private equity fund raised $5.6 billion from investors in 2021.
Source: Reuters.com