Bregal Sagemount preps sale of Steele Compliance

The exit is expected to produce a good outcome for Bregal Sagemount, which bought Steele in 2016 before it was profitable, sources said.

Bregal Sagemount is preparing to sell software risk management provider Steele Compliance after a four-year hold, sources familiar with the matter told PE Hub.

The sources said the sale process is expected to launch this quarter and that UBS has been mandated as sell-side financial adviser.

Steele Compliance, based in San Francisco, is a software company providing risk management and compliance tools for small- to mid-sized businesses through its Enterprise data-as-a-service platform.

The sources said the company produces around $50 million in revenue. They added that the exit is expected to produce a good outcome for Bregal, which bought Steele in 2016 before the company became profitable.

One source noted that Steele is seeing “a ton of interest” and has been “top of mind” among some financial sponsors for a while. They added that compliance is a hot space and Steele is one of only a few software companies of scale that operate within the category.

Bregal Sagemount, based in New York, typically invests $15 million to $150 million per transaction. The growth equity firm targets sectors including software, digital infrastructure, healthcare IT, IT services, business and consumer services, and financial technology and specialty finance.

In March, Bregal Sagemount closed Fund III at a hard cap of $1.5 billion, thereby exceeding its $1.35 billion target.

Bregal Sagemount, UBS and Steele Compliance did not return PE Hub’s requests for comment.

Action Item: See Bregal Sagemount’s recent form ADV.

Correction: This report has been updated to reflect that Fund III collected $1.5 billion, versus Fund II.