HgCapital Trust plc Regulatory News (HGT)

Hg, the Manager of HgCapital Trust plc ("HGT"), today announces an investment in Gen II Fund Services, LLC ("Gen II"), a leading independent private equity fund administrator.

The terms of the transaction were not disclosed and closing of the transaction is conditional on customary anti-trust and regulatory approvals.

HgCapital Trust plc will invest approximately £20 million in Gen II, with other institutional clients of Hg investing alongside HGT through the Hg Genesis 9 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 HGTs share of Hg's overall investment in Gen II.

HGT's liquid resources available for future deployment (including all announced transactions and the interim dividend payable in October 2020) are estimated to be £113 million (10% of the 31 August 2020 pro-forma NAV of £1.16 billion, including the increase in equity via tap equity issues over the third quarter of 2020). In addition, HGT has access to an £200 million standby facility, which is currently undrawn.

The investment will reduce HGT's outstanding commitments to invest in Hg transactions to approximately £663 million (57% of the 31 August 2020 pro-forma NAV).

Gen II Gains Significant New Investment From Global Investors

to Fuel Continued Long-Term Expansion

General Atlantic, Hg and IHS Markit aim to strengthen Gen II's suite of solutions, supporting a growing customer base and generating further strategic growth

New York, New York, USA and London, UK. 6 November 2020: Gen II Fund Services, LLC ("Gen II"), a leading independent private equity fund administrator, announced today that it has secured a new strategic investment. General Atlantic ("GA"), a leading global growth equity firm, and Hg, a leading global software investor, together will lead the investment. IHS Markit (NYSE: INFO), a world leader in critical information, analytics and solutions, will also make a minority investment in the company. Cobepa S.A will continue to hold a minority position. The Gen II founders and management team will continue to hold a significant investment in Gen II whilst continuing to lead the business.

The terms of the transaction were not disclosed and closing of the transaction is conditional on customary anti-trust and regulatory approvals.

Led by its three original co-founders - Steven Millner, Steven Alecia and Norman Leben - since 2009, Gen II is a leading pure-play provider of alternative asset fund administration services. With headquarters in New York, New York and Luxembourg and serving a global client base, the company administers over $375 billion of private capital on behalf of its clients across more than 500 funds and their 25,000 investors, spanning various investment strategies including Buyout, Infrastructure, Energy, Real Estate, Fund of Funds, Credit and Retail. 

Gen II is differentiated by providing a leading, tech-enabled platform offering a high-touch, premium service to its clients in fund administration, accounting, reporting and regulatory compliance. Mr. Millner, Mr. Alecia and Mr. Leben have built a strong team providing an industry-leading experience to the Firm's clients, which has led to consistent, uninterrupted double-digit organic growth over the last 10 years. 

Steven Millner, Steven Alecia and Norman Leben, co-founders of Gen II, said: "We are excited to partner with General Atlantic, Hg and IHS Markit to make Gen II even stronger. Our new investors each bring game-changing expertise to our Firm and our clients. General Atlantic brings 40 years of global growth equity investing and will be superb advisors as we expand our capabilities and reach. Hg, the largest software investor in Europe, brings deep software and service business intelligence that we will leverage to help refine our products. And IHS Markit, developers of WSO Software and iLEVEL, brings technology, analytics and product expertise that will help us transform the features and performance of our platform. This is a powerhouse combination."

Gabriel Caillaux, Co-President, Managing Director and Head of EMEA at General Atlantic, said: "We are thrilled to partner with Gen II in its next phase of growth. Under the leadership of Steven, Steven and Norman, the business has become a critical player across the full fund lifecycle of the alternative asset ecosystem. We see significant potential to help drive market expansion across a growing global base of GPs and their investors."

Adam Kansler, President of Financial Services at IHS Markit said: ''Through its innovation and value-added solutions, Gen II is a leader in fund administration for alternative assets. Given our growth strategy and commitment to enabling the success of private capital markets, we are pleased to invest additional resources with GA, Hg and the Gen II leadership team to further support our global GP and LP clients."

Thorsten Toepfer, Partner at Hg, said: "Today Hg is investing in a very strong business, which has built a differentiated profile to become the platform-of-choice for its industry. In line with the management team's ambition, we see potential to scale further, both across the sector and across geographies. Hg has invested over $2 billion into wealth & capital markets as well as compliance services and technology platforms to date and we are looking forward to using this expertise to continue Gen II's success together with our partners."

Joris Van Gool, Partner at Hg, said: "We have actively followed the fund administration space for several years and during this time we've seen Gen II build a reputation as one of the most respected alternative asset administration tech platforms in the industry. The founders have been right at the heart of this the whole way and it is truly impressive what they and their team have achieved. Alongside them, and our new investment partners, we look forward to bringing our experience in fintech to see what we can achieve together."

Adam Kansler, President of Financial Services at IHS Markit said: ''Through its innovation and value-added solutions, Gen II is a leader in fund administration for alternative assets. Given our growth strategy and commitment to enabling the success of private capital markets, we are pleased to invest additional resources with GA, Hg and the Gen II leadership team to further support our global GP and LP clients with best-in-class services."

Advising the buy side on the transaction were HPS (debt financing), Skadden and Paul Weiss (legal), Raymond James (M&A), Linklaters (debt legal), PWC and EY (financial due diligence, tax and structuring), Bain (commercial due diligence) and Validus (FX). Advising Gen II on the transaction were Baird (financial advisor), Kirkland & Ellis LLP (legal) and Alvarez & Marsal (financial due diligence, tax and structuring). Advising Cobepa on the transaction was White & Case LLP (legal).

For further details:

Hg

Laura Dixon +44 (0)20 8396 0930

Brunswick

Samantha Chiene +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 and Gen II, General Atlantic and IHS Markit websites are not incorporated into, and do not form part of, this announcement.