FPE Capital announces the successful sale of Small World Financial Services
The Transaction is the second payments sector exit in two months for FPE
FPE Capital (“FPE”) is pleased to announce its second successful exit of a financial technology investment in the last two months, with a sale that will see the full cash realisation of its investment in Small World Financial Services Group (“Small World”).
Small World is a technology driven provider of cross-border payment services, offering a secure, fast and low-cost way to send and receive money across the world. The Company is headquartered in London, with operating hubs in a number of countries across the world, including Madrid, New York and Zurich. The completion of the transaction is subject to regulatory approval and will generate a return of approximately 3.0x to FPE.
Small World is being acquired by Equistone Partners Europe, a leading pan-European mid-market private equity firm that invests in companies with Enterprise Values of up to €500 million, and which has a strong track-record in the financial services sector.
FPE, which recently completed the raise of a new £100m fund in October 2017, partners with high growth UK-headquartered technology-enabled SMEs, including those in the payments and fintech sectors. It invested £12m of growth capital into Small World, becoming the lead institutional investor.
Since then it has supported the company through a substantial phase of organic and acquisitive growth. Between 1 July 15 and 30 June 2017, the business has achieved an organic compound annual growth rate in its revenues of 27%, and over the life of FPE’s investment, with the help of acquisitions the revenues have grown over fivefold to over £110m. Henry Sallitt and Dan Walker led the investment for FPE and were non-executive directors of Small World through-out the period.
Major strategic achievements during FPE’s period of investment include the development of the companies digital & mobile offering, ensuring Small World’s customers benefit from an omni-channel experience. In addition, the business has achieved massive international expansion. Most significantly through the acquisition of a complimentary business in the US, but also with organic entry into multiple new European markets including the Benelux regions, Germany and Scandinavia, and more recently into emerging markets such as South America and West Africa.
David Barbour, Managing Partner at FPE Capital, commented: “We are delighted to announce our second successful payments sector exit within two months. Following on from the recent sale of Creditcall to NMI at a 4.2x return, this exit of our investment in Small World underlines our strength in the payments and fintech sector and our commitment to growing UK businesses into world class companies. We are delighted to have worked with Nick Day and his team at Small World to make such great progress in transforming this business. Our ambition and strategy of investing aggressively for growth – our entire investment was in new funding to accelerate the Company’s business plan - was central to helping Small World reach this landmark sale. We are confident Small World is well placed to continue to grow as an independent business under new ownership and we wish Nick and all the team the best for the future.”
Nick Day, CEO of Small World, commented: “During FPE’s period of ownership, we have delivered significant growth in our network, transaction volumes and financial performance. With the operational scalability of our single technology platform this has delivered us both a competitive advantage and growing profit margins. The management team is excited about the next phase of our growth working alongside Equistone”.
Headquartered in London, UK, Small World currently is employing c680 employees.
Canaccord Genuity (“Canaccord”) and Charles Russell Speechlys (“CRS”) advised the shareholders of Small World in the transaction.
For further information, please contact:
David Barbour, FPE Capital +44 (0)20 3912 8801
Reg Hoare, Managing Director, MHP Communications +44 (0)20 3128 8793
Kelsey Traynor, Associate Director, MHP Communications +44 (0)20 3128 8215
FPE Capital LLP is a growth-focused private equity investor in the UK lower mid-market. It targets businesses with recurring revenues that offer significant growth potential in large markets undergoing structural change. It is authorised and regulated by the Financial Conduct Authority. www.fpecapital.com
Small World Financial Services is a London-headquartered provider of trusted, simple and low cost international payment services, using its proprietary global pay-out network, serving consumers and businesses across Europe, North America, West Africa and South America. Small World was founded by Nick Day, Ricky Knox, and Michael Kent in 2005, and these founders were joined by Christiano Arnhold Simoes and Kevin Neuschatz through the acquisitions of Swiss Transfers and Choice Money Transfer in 2009 and 2010 respectively. Small World has grown rapidly over the past decade, both organically and through acquisition, to become one of the world’s leading payment service providers, and is a member of Tech City UK’s exclusive Future Fifty programme.
For more information, visit http://www.smallworldfs.com/