Internal Rate of Return (IRR) 60% 44%

Fund

Advent 4 & 5

Sector

Technology
Money Multiple 6.5x 2.8x

Inv. Date

March 2006

Inv Date

April 2010

Background

SCADAGroup, through its Serck Controls businesses in Australia and UK, is a leading provider of systems integration solutions and supervisory control and data acquisition (SCADA) products to water utilities and oil & gas businesses.  These solutions allow SCADA Group’s clients to monitor and control their valuable infrastructure assets, meet legislative and regulatory standards, and improve safety, efficiency and security of supply.

Advent IV’s initial $10m investment in SCADA Group funded the replacement of Catalyst Investment Management’s equity and enabled management to continue with their growth strategies for the business.

Advent IV and V invested a further $1.2m and $7.5m respectively to fund the acquisition for Trio Datacom, with the remainder being debt funded.

Investment Rationale

KEY QUALITIES
  • Robust industry outlook in key water, and oil and gas markets in Australia and the UK
  • Company founder and CEO with extensive background in the SCADA industry
  • Reliable revenue stream in the Australian and UK water markets given few customers change suppliers
  • Proprietary technology
INVESTMENT THESIS
  • Develop markets where SCADAgroup performance is strong and close underperforming markets
  • Shift focus to the products business to enhance margins, growth and strategic value
  • Selectively acquire and develop products to sell-down channels
  • Centralise research and development
  • Expand channels into Europe, USA and South America

While we have been private-equity funded since 1997, our major growth came after teaming with Advent following a secondary buyout in 2006. Advent has been the perfect fit and has had the right focus for the business. They gave the management team support to grow the business while ensuring all parties focused on a strategy for an eventual exit. A key element in the success of the relationship with the Advent team was their correct level of involvement. They were always supportive but not intrusive in the day-to-day operation of the company.

Paul Chisholm Managing Director, SCADAgroup

Value Add

  • Replacement of PE investor and enabled management to continue growth strategy;
  • Shifted focus from a service to a products business to leverage proprietary products and software;
  • Closure of two under-performing operations and opening of sales offices in new markets to increase exposure to the growing oil and gas sector;
  • Increased ownership of key Canadian operations from 25% to 100% and successfully acquired two further businesses; and
  • Focused management on exit, including introduction to Schneider in 2007.

Exit

Advent and management jointly drove the successful exit program with Schneider Electric of France. Advent worked alongside management to ensure the best possible investor outcome. The result represented  11 times forecast FY10 EBITA, which reflected the fact that the Company had been built up to be a world class strategic asset.