LONDON (Reuters) - European buyout house CVC Capital Partners [CVC.UL] is seeking an exit from Dutch HR software and services provider Raet, two sources familiar with the matter said on Thursday.
The private equity firm is working with Rothschild on a potential deal, which could value the business at between 376 million euros to 564 million euros ($619.10 million), or eight to twelve times its 2014 earnings, the sources said.
Raet, which employs around 1,000 people, is the Netherlands’ biggest provider of human resources in the IT field, with turnover of 147.9 million euros, according to CVC’s website.
The business had core earnings (EBITDA) of 47 million euros in 2014 and is already being eyed by other private equity firms, one of the sources said.
CVC and Rothschild declined to comment.
CVC bought Raet in 2011 for an undisclosed sum. But media reports at the time said its then owners, Advent and Taros Capital — a spinout from AlpInvest Partners — were seeking around eight times EBITDA for the business, or about 400 million euros. Another source said companies in the industry could fetch as much as 12 times EBITDA.
Raet’s software services include recruitment and workforce management, as well as supporting payroll administration.
The sector has attracted private equity interest over the years with varying degrees of success. In 2013 HG Capital purchased Germany’s P&I for an enterprise value of 438 million euros.
U.S. buyout firm KKR’s (KKR.N) British HR software company, Northgate NGA, was taken over by lenders in November last year.
CVC also has stakes in Spanish clothing chain Cortefiel and Formula One. The buyout firm has been exploring new ways to obtain decent returns, as private equity finds itself facing competition from the likes of pension funds and prices are pushed further higher due to a scarcity of assets on the market.
In February CVC raised $1 billion for a tech-focused growth fund. Late last year it made the first purchase from its Strategic Opportunities platform, designed for investments over a longer-term horizon.
Reporting By Freya Berry, additional reporting by Arno Schuetze; editing by Sophie Sassard and Susan Thomas