Advent Fills Staffing Company Coffers

Alexander Mann Group of London raised GBP25 million ($40 million) from Advent International in late May to augment the company’s efforts to acquire other information technology staffing businesses.

Boston-based Advent was the sole investor in the pay-in-kind preferred stock transaction, said John Singer, a managing director at Advent. Following the deal, Singer and fellow principal Chris Stacey will represent the firm on Alexander Mann Group’s (AMG) board of directors.

AMG offers three primary services to IT providers and users. Singer said the company’s main focus has been staffing services and will likely continue to be so. Typically these services entail AMG providing a company that, for whatever reason, cannot find its own IT specialist, with a temporary employee working under a contract that may run anywhere from six months to one year. The bulk of the company’s business in this sector comes from IT service companies and the clients of those companies.

The outsourcing of IT recruiting services is the second function, which Singer said is the current flavor-of-the-month in IT. In these instances, AMG provides companies with internal recruiters who assume a role inside the client’s quarters.

“That is becoming an important area because they are on a longer contract and can in turn recruit people [from AMG],” Singer said.

Executive search services is the company third operation. In that role, AMG operates like a traditional headhunter, primarily serving clients in financial services and banking, as well as the back office areas of those industries.

Proceeds from the offering will serve as expansion capital to support AMG’s internationalization efforts and acquisition. The company has done most of its business in Britain to date, but as IT creates more cross-border business, clients have drawn AMG into Western and Central Europe. Singer said the company also intends to pursue expansion opportunities in Australia and the U.S., although he said there were no immediate plans in those countries.

Further, Singer said the company plans to compete in the rapid consolidation going on in the industry. The goal of the effort will be to provide wider services to clients and build market share across its focus sectors.

“What you’re getting, is companies have to choose to be the hunter or the hunted and [AMG] wants to be a hunter,” Singer said.

Advent made the investment with the intention of growing AMG to the point where it can hold an initial public offering either in the U.K. or the U.S. Singer said that the build-up process would likely take three to four years.