How Palatine made 6x on its Anthesis investment

Tom Ross-Jones, partner at UK-based private equity firm Palatine, speaks to Mergermarket senior private equity reporter Rachel Lewis about the sponsor’s journey with sustainability consultancy Anthesis, setting out how the deal was originated, the value creation initiatives during the investment period, and the exit process.

If private equity had its own dictionary, value-creation could easily have been a top contender for ‘phrase of the year’ through 2023. Everyone is speaking about it, but there are still questions around how many GPs are achieving it.

Palatine originally took a minority stake in sustainability consultancy business in Anthesis in the quarter of 2021 for a reported GBP 50m. Just two years later it, returned 6x with Carlyle Group entering as a majority shareholder, only for Palatine to re-invest in a minority position to keep some exposure to the business. The deal was valued at a reported GBP 400m, although Palatine did not confirm this valuation.

In this episode, Ross-Jones, discusses the sponsor’s investment and journey on value creation. He starts off by discussing the sponsor’s approach to origination, what measures it put in place as a minority shareholder, and the significance of human capital and culture in creating value.

Later, the podcast delves into the importance of data, whether buy-and-build still works, how it got the company ready for an exit and exactly why it reinvested under Carlyle’s ownership.

Introduction – 0:31

Interview with Tom Ross-Jones – 1:35

• Palatine’s approach to origination and first eyes on Anthesis – 1:58
• Making a minority investment – 5:00
• Approach to leverage – 7:23
• First steps and initial value creation – 9:02
• Palatine’s value creation playbook – 16:48
• Levers for mid-cap value creation – 20:18
• Integrating bolt-ons and the future of buy-and-build – 22:23
• Getting the company ready for exit – 26:40
• Reinvesting for a minority stake – 30:33

You can listen to the podcast on your favourite podcasting platforms, including Spotify and Apple Podcasts.

If you would like to hear more podcasts produced by ION Analytics, you can access the ION Analytics channel on Apple Podcasts.

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