NBGI Private Equity (NBGIPE), the lower mid-market buyout firm, has sold its majority stake in Ochre House to US-based Pinstripe backed by Accel-KKR, which delivers a 4x return on NBGIPE’s original investment.
The sale will result in the combined business becoming the largest independent provider of global recruitment process outsourcing (RPO) and talent management solutions.
Ochre House has rapidly grown to become a leading provider of talent management services in the UK, Continental Europe and the Middle East and represents a significant EMEA platform for the US buyer, Pinstripe. The EMEA market is estimated at approximately USD967m and is expected to grow to over USD1.4bn by 2016, with EMEA representing around one third of the global RPO market.
Belinda Berkeley, NBGI Private Equity’s investor director of Ochre House, says: “We are delighted to have worked with an exceptional and highly committed management team and played a role in building Ochre House into a leading multi-regional RPO player. It is credit to management that they kept the business focused on the high value strategic hiring demands of blue chip clients, a market which has continued to grow ahead of the broader recruitment market. This investment shows our commitment to investing in companies with compelling value propositions.”
The announcement comes at a time when the increasingly globalised nature of business means multinationals must have a coherent strategy for attracting and retaining talent as they operate and expand in different parts of the world. Ochre House and Pinstripe have been working in partnership since 2009 to provide global solutions, and the combination of the businesses is a response to increasing client demand for a single, dedicated provider of end-to-end talent solutions worldwide. The combined global presence will now include more than 750 employees, serving 88 clients in 40 countries around the world.
NBGIPE backed the 2006 buyout of Ochre House, with Chris Herrmannsen as chief executive, which was then a group of six disparate recruitment businesses. The strategy was to grow those businesses using a shared central function and create value through a staged exit strategy. In 2011 the last of the non-core businesses were sold, allowing the management team to focus on the high value and fast growing talent management business. This growth was accelerated in early 2012 when NBGIPE invested further funds to support the acquisition of Taaheed and Carmichael Fisher in the Middle East – the two leading talent management businesses – to create a significant global RPO player.
With NBGIPE’s support, the Ochre House talent management business has expanded from a business of just 22 employees in 2006 to employing more than 240 at present and turnover has increased by a compound annual growth rate of over 100 per cent p.a. from 2006 to present day.
Mark Owen, a founding director of NBGIPE, says: “We are pleased to deliver another strong return to our investors. Our investment in Ochre House validates our commercial approach, working with the management and capitalising on growth opportunities through making follow on acquisitions. This return emphasises why Business Services is one of our three target sectors for investment.”
“Pinstripe and Ochre House’s combined strength will become the new benchmark for global RPO and talent management services,” says Herrmannsen. “We intend to further expand our footprint into emerging markets and provide our clients with a powerful, unified solution for navigating today’s increasingly competitive talent marketplace.”
