Genstar Capital has agreed to acquire Institutional Shareholder Services Inc, a provider of corporate governance and responsible investment solutions to investors, for $720 million. The seller is Vestar Capital. The deal is expected to close in the early fourth quarter of this year. Simpson Thacher & Bartlett LLP provided legal advice to ISS and Vestar Capital Partners on the transaction while Willkie Farr & Gallagher LLP served as legal counsel to Genstar Capital.
NEW YORK & SAN FRANCISCO (September 7, 2017) – Institutional Shareholder Services Inc. (ISS), a leading provider of corporate governance and responsible investment solutions to financial market participants, today announced that Genstar Capital has entered into a definitive agreement to acquire ISS from Vestar Capital Partners for $720 million.
The transaction is expected to close by early fourth quarter, subject to customary closing conditions.
ISS will continue to operate independently once the transaction is completed and the current ISS executive leadership team will remain in place.
“The ISS leadership team and I are extremely pleased to partner and collaborate with Genstar, whose deep experience and successful track record working with industry-leading firms such as ours, will help us further accelerate the growth of our product and service offerings for the benefit of clients,” said ISS President & CEO Gary Retelny. “ISS has the right partner in Genstar to remain sharply focused on our long-standing commitment to provide market-leading expertise, innovation, and service in the area of global corporate governance.
“We thank Vestar Capital Partners for their commitment to ISS and its clients around the globe over the past three years. It has been a tremendously successful partnership,” Mr. Retelny said.
“Our partnership with Gary Retelny and the ISS management team has been extremely productive and highly successful, including the completion of five acquisitions, which significantly broadened its products and services,” said Rob Rosner, co-president of Vestar. “We are proud of how ISS has expanded its business over the past several years and strengthened its global position as the leading authority in corporate governance.”
Genstar Capital Managing Director Tony Salewski welcomed the addition of ISS to the Genstar family of portfolio companies, reflecting its approach of backing strong management teams by investing in leading businesses that provide critical tools and services to the financial services community.
“While maintaining its status as the premier governance provider, ISS has expanded significantly over the past three years, exhibiting a deep commitment to its clients by building a robust infrastructure and continuing to develop a world-class suite of ESG solutions,” said Salewski. “We are excited to back Gary and his team in building on this progress through both organic and acquisition growth initiatives globally.”
ISS currently has more than 1,000 employees operating across 19 global offices in 13 countries. Its approximately 3,000 clients include many of the world’s-leading institutional investors who rely on ISS’ objective and impartial proxy research and data to vote portfolio holdings, as well as public companies focused on governance risk mitigation as a shareholder-value enhancing measure.
Simpson Thacher & Bartlett LLP acted as legal advisor to ISS and Vestar Capital Partners on the transaction, Willkie Farr & Gallagher LLP to Genstar Capital, and Davis Polk & Wardwell LLP to ISS’ management.
Founded in 1985 as Institutional Shareholder Services Inc., ISS is the world’s leading provider of corporate governance and responsible investment (RI) solutions for asset owners, asset managers, hedge funds, and asset service providers. ISS’ solutions include: objective governance research and recommendations; RI data, analytics, advisory and research; end-to-end proxy voting and distribution solutions; turnkey securities class-action claims management (provided by Securities Class Action Services, LLC); and reliable global governance data and modeling tools. Clients rely on ISS’ expertise to help them make informed corporate governance and responsible investment decisions. For more information, please visit www.issgovernance.com.
About Genstar Capital
Genstar Capital (www.gencap.com) is a leading private equity firm that has been actively investing in high quality companies for more than 25 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.
About Vestar Capital Partners
Vestar Capital Partners is a leading U.S. middle-market private equity firm specializing in management buyouts and growth capital investments. Vestar invests and collaborates with incumbent management teams and private owners to build long-term enterprise value, with a focus on Consumer, Healthcare, and Business Services & Industrial Products. Since its founding in 1988, Vestar funds have completed more than 80 investments in companies – as well as more than 200 add-on acquisitions – with a total value of approximately $50 billion. For more information, please visit www.vestarcapital.com.