Genstar Capital recapitalized fund administrator Apex Fund Services and simultaneously acquired Equinoxe Alternative Investment Services. With the acquisition of Equinoxe, Apex increases its suite of services and will administer close to $80 billion in assets. Apex Chief Executive Officer Peter Hughes will retain a significant minority stake in the combined business and continue to lead the organization.
Genstar Capital (“Genstar”), a leading middle-market private equity firm, in partnership with industry veteran Peter Hughes, today announced the entry into definitive agreements to recapitalize independent fund administrator Apex Fund Services (“Apex”) and simultaneously acquire Equinoxe Alternative Investment Services (“Equinoxe”).
Headquartered in Bermuda, Apex was founded in 2003 by Peter Hughes and today provides back office, middle office, regulatory reporting and other administrative services to a global customer base of asset managers across all asset classes. With the addition of Equinoxe, Apex will increase its suite of middle office solutions and will administer close to $80 billion in assets. With enhanced capabilities, global reach and capital support from Genstar, Apex has a goal of becoming a top 5 global fund administrator within the next five years. Peter Hughes will retain a significant equity stake in the combined business and will continue to lead the combined business in his role as Founder and Chief Executive Officer.
Tony Salewski, Managing Director of Genstar Capital, said, “There is a large and growing market for outsourced fund administration services to private and public market managers. The combination of these two leading and complementary businesses will immediately create a global fund administrator with significant scale, a full suite of solutions, global presence, and the expertise of an experienced management team. The opportunity to build a platform around Apex fits squarely within our approach of investing in leading businesses that provide critical tools and services to the investment management industry. We are excited to support Peter and his team in driving accelerated growth through strategic add-on acquisitions and expansion within high growth areas of the fund services market.”
Peter Hughes commented, “This is a significant step in Apex’s ongoing development as a global institutional provider. The Equinoxe team has built a successful business, and its combination with Apex will provide a strong strategic and cultural fit. We are extremely pleased to partner with Genstar, a firm that shares our guiding principles for delivering quality service to clients. We also share an ongoing commitment to growing Apex, both organically and through acquisition. We look forward to partnering with Genstar to continue to build scale and enhance Apex’s ability to service clients across multiple jurisdictions.”
Steve Castree of Equinoxe added, “The team at Equinoxe is excited to be joining forces with Apex. This transaction is a natural fit for us as our philosophy for always putting client service standards first is tightly aligned with the way in which Apex already operates – our clients and staff will benefit from being part of a larger firm that is also committed to these ethics and standards.”
The closing of the transactions are subject to customary closing conditions, including the receipt of regulatory approvals. The parties expect the transactions to close in the third quarter of 2017.
Apex has been a portfolio company of FTV Capital, a growth equity investment firm, since 2011. Equinoxe has been a portfolio company of private equity firm Estancia Capital Management since 2013.
Macquarie Capital served as financial advisor to Apex. Willkie Farr & Gallagher LLP served as legal counsel to Genstar. Debevoise & Plimpton LLP served as legal counsel to Apex and its sellers. Kirkland & Ellis LLP served as legal counsel to FTV.
About Genstar Capital
Genstar Capital (www.gencap.com) is a leading private equity firm that has been actively investing in high quality companies for nearly 30 years. Based in San Francisco, Genstar works in partnership with its management teams and its network of strategic advisors to transform its portfolio companies into industry-leading businesses. Genstar manages funds with total capital commitments of approximately $9 billion and targets investments focused on targeted segments of the financial services, software, industrial technology, and healthcare industries. Genstar’s current and previous investments in financial and business services companies include Ascensus, AssetMark, Strategic Insight, Mercer Advisors and Altegris.
About Apex Fund Services
Apex Fund Services (www.apexfundservices.com), established in Bermuda in 2003, is one of the world’s largest independent fund administration and middle office solutions providers with offices in 32 locations worldwide. Apex has continually improved and evolved its product suite by surrounding these core administrative services with additional products spanning the full value chain; from information delivery and regulatory products to capital introduction services. Apex now administers the investments of some of the largest funds and institutional investors in the world.
About Estancia Capital Management
Estancia (www.estanciapartners.com) is a private equity firm focused on small to lower middle market investments in Institutional Quality Asset Management, Wealth Management and related Business Services companies. The Principals have a history of partnering with management and investment teams in providing equity, growth and working capital to facilitate strategic and opportunistic development of portfolio companies including management buy-outs from larger financial firms, private ownership/succession transitions and growth initiatives. Estancia’s current investments in financial and business services companies include Abel/Noser, American Beacon, Snowden Lane and SGA.