IPSSI, a group of private higher education schools dedicated to digital professions, finalized its primary OBO operation with Abénex Croissance at the end of September. The group’s shareholders had given an exclusive mandate to Crescendo Finance to seek a financial partner. Yoann Roussel, Managing partner of the investment bank, discusses this operation, which resulted in a valuation of the securities equivalent to more than ten times the EBITDA.
Décideurs. How did you support IPSSI in the search for a financial partner
Yoann Roussel. In parallel with VDD’s preliminary work, which we coordinated with the transaction services firm, we began by defining the most appropriate financial engineering package, capable of meeting both the personal and strategic objectives of our clients. We then produced all the marketing documentation for the funds with a careful equity story. Funds that we have selected according to the strict selection criteria of our clients, in particular to open up the capital to a minority but significant investor, in order to move forward quickly with the most relevant ones. At the end of the road shows, we conducted the negotiations and then organized the audit phase and formalization of the final legal agreements.
Décideurs. How was the choice to bring an investment fund, and more particularly Abénex, into the capital of IPSSI ?
IPSSI’s shareholders wanted both a cash-out operation to realize part of their assets, while remaining in control in order to begin a new stage of development by joining forces with an investment fund capable of help them further boost their very strong organic growth, in particular through the opening of new campuses in the regions. Abénex very quickly appeared as the ideal partner, benefiting from a remarkable track record in education, a sector that they master particularly well. The excellent human fit did the rest. The Abénex teams understood that the IPSSI, after twenty years of existence, was a strong brand and knew how to convince our clients that they could help them to stimulate beyond Île-de-France a new growth momentum by duplicating the model through new geographical locations, where there are significant market shares to be taken, particularly in work-study IT education. However, external growth is not excluded if opportunities arise.
How do you view the record valuations that we have observed for several months on certain assets?
The high levels of valuation are explained both by the density of the financial mass that the funds must invest, but also by the sustainability of the targeted assets, including tech, health, FIG and education. These are fast-growing companies with excellent levels of profitability thanks to business models that provide the funds with high visibility due to the recurrence of contracts held. The management teams in place are of high quality and many of them want to consolidate their markets, which also hold extremely strong underlyings. All the ingredients are therefore in place to carry out build-up operations guaranteeing the funds good exit prospects and resilience in the event of a market downturn.
Interview by Béatrice Constans