Baring Asia buys Tricor from Permira for $2.7b

The private equity firm has owned Vistra Group, which operates in broadly the same space, since 2015, leading an aggressive M&A-driven expansion. It was among the bidders for Tricor when Permira bought it in 2016. However, Tricor will sit alongside Vistra – as opposed to within it – as a “separate and new platform investment,” according to a statement.

Tricor became available in 2016 after majority owner Bank of East Asia was targeted by activist investor Elliott Management. Permira prevailed in a competitive process with a bid of $835 million, valuing Tricor at 15x earnings, based on EBITDA of approximately $55 million in 2015. It noted at the time that opportunities to pick up a market leader in a highly fragmented industry were rare.

The areas of commonality with Vistra primarily cover two of Tricor's three divisions: corporate services such as company incorporation, trust, fiduciary, and fund administration functions; and business services, which encompasses taxation, accounting, and payroll processing. The third, not typically offered by competitors, is investor services and share registry management.

The breadth of the company's product offering can be traced back to its origins in 2000, when Bank of East Asia engineered a spin-out from the Big Four accounting firms.

Tricor describes itself as Asia’s leading business expansion specialist, with more than 2,800 staff across 21 jurisdictions. It works with approximately 50,000 clients globally, including more than 40% of the Fortune Global 500.

When Permira bought the company, there were 2,000 staff in 37 cities across 20 jurisdictions. It went on to complete more than 10 bolt-on transactions. Lennard Yong, group CEO of Tricor, added that revenue and EBITDA have grown 2x and 2.5x, respectively, during Permira’s holding period.

“Together we have significantly transformed the company from a heritage brand to a leading-edge business with a deeper presence across Asia, accelerating growth, attracting great talent, enhancing digital capabilities and adding a number of exciting new business lines,” Robin Bell-Jones, a partner at Permira, said.

BPEA will continue the consolidation project, noting that the market remains highly fragmented. The transaction is expected to close in the first half of 2022.

The private equity firm is committing capital from its eighth pan-regional fund, which recently completed two closes, receiving commitments of $8.5 billion. It launched the vehicle earlier this year with an overall target of $8.5 billion and is now expected to end up with around $10 billion.

PE investors globally have been prolific in corporate services, drawn by high recurring revenues, strong cash generation, and structural growth. CVC Capital Partners acquired TMF Group from Doughty Hanson in 2017, while The Blackstone Group bought Intertrust from another GP in 2013 and listed it two years later. General Atlantic was previously an investor in Citco, exiting in 2018.

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• Topics
• Buyouts
• Support services
• Greater China
• Trade sale
• Hong Kong (China)
• Asia
• Baring Private Equity Asia
• Permira Advisers
• professional services