HgCapital To Buy TeamSystem from Bain

LONDON (Reuters) – HgCapital is set to buy Italian accounting software firm TeamSystem, three people familiar with the matter said, after beating rival buyout firm Cinven in the final stages of the auction.

Seller Bain Capital could get as much as 600 million euros ($783 million), one of the people said. Bain received bids from both firms by Friday’s deadline as listed British software provider Sage (SGE.L) unexpectedly withdrew from the process. [ID:nN30206177].

A sale at that price would value the Italian provider of tax, payroll and budgeting software for small- and mid-sized businesses at about 12 times earnings before interest, tax, depreciation and amortisation (EBITDA).

The deal would be HgCapital’s biggest-ever acquisition, Thomson Reuters data suggests, ahead of another deal in which Hg also saw off Sage — the $591 million purchase of Norwegian accounting firm Visma in 2006. Earlier this year the Times said HG was preparing Visma for a flotation.

Private equity firms are competing aggressively for deals and increasingly buying companies from each other in so-called secondary and tertiary buyouts, as they look to invest hundreds of billions of dollars of unspent capital.

Private equity-backed deals reached a two-year high at $27.4 billion in July, accounting for 15 percent of overall mergers and acquisitions (M&A), according to Thomson Reuters data.

All of the private equity firms and Sage either declined to comment or could not be reached for comment. ($1=.7664 Euro) (Reporting by Victoria Howley and Quentin Webb; Editing by Jon Loades-Carter)