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M&As Davis + Henderson-Gores Group

Published on March 7th, 2013 | by Ted Liu

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The Gores Group to acquire Davis + Henderson business processing units

The Gores Group, a private equity firm that acquires controlling interests in mature and growing businesses, has entered an agreement with Davis + Henderson Corporation (TSX: DH) (D+H) to acquire D+H’s several business processing businesses. Financial terms were not disclosed. Davis + Henderson said the transaction is not considered material.

The businesses, operating in five locations across Canada, include Credit Card Services, Contact Centre Services, Benefits & Administration, and Coupon & Rebate Services, acquired as part of its $200 million acquisition of Resolve Business Outsourcing Income Fun in 2009, and Real Estate Services, acquired as part of its $212.5 million acquisition of Filogix in 2006.

The businesses largely serve customers comprising retailers, real estate boards, and packaged goods companies. The businesses generate around $60 million of revenue, D+H said it does not expect the divestiture to have a material impact on its operating profits.

Davis + Henderson and The Gores Group have entered into a transition services agreement for a smooth transition for customers. Management, staff and facilities related to these businesses are transitioning as part of the agreement.

“Since owning these businesses we have developed them into solid businesses that have strengthened the value to customers. We want to thank the approximately 1,400 employees working in these businesses for their dedication and what they were able to accomplish for customers,” said Gerrard Schmid, CEO of D+H.

The transaction is expected to close in mid-April, 2013.

Origin Merchant Partners acted as the financial advisor to D+H for this transaction.

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About the Author

Ted is an editor of CanadianPrivateEquity.com and Research Director for CVCA - Canada's Venture Capital and Private Equity Association. Ted has been following Canadian venture capital and private equity industry since 1993.



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