Spotlight on Business Services Private Equity Deals in 2021

Fairgrove has done an in-depth review of private equity deals in business services, segmenting deals by area and sub-category, covering both Europe, and the UK and Ireland. Marketing and Communications, Management Consulting, Engineering Services, and Waste Management were all popular sectors, although funds have invested across a range of different areas.

Figure 1: 2021 Business Services Deals, Europe (incl. UK and Ireland)

1. Excludes the ‘hard end’ of support services within industrials, such as logistics and transportation.
Number of Deals; SOURCE: Unquote; Fairgrove Research

Figure 2: 2021 Business Services Deals, UK and Ireland

1. Excludes the ‘hard end’ of support services within industrials, such as logistics and transportation.
Number of Deals; SOURCE: Unquote; Fairgrove Research

Given ongoing macroeconomic uncertainty, private equity firms are increasingly attracted to the non-discretionary spend and recurring revenue models that many service lines in this sector offer. Strategies for growth are also abundant, and can include domestic and international growth, product and market extension, and implementing a national roll-up (benefiting from multiple arbitrage).

Fairgrove has worked across a number of these sectors, with a small sample of recent projects included below.

Figure 3: Selection of Fairgrove’s recent projects in Business Services

SectorTargetInvestor
Accounting & TaxDainsHorizon
Fire & SecurityChurches Firen/a (refinancing)
Human CapitalSkills AlliancePalatine
Management ConsultingBP3Horizon
Management ConsultingDufrainPhoenix
Management ConsultingHarmonicKBR (Trade)
Management ConsultingICPNorthEdge
Market IntelligenceMarket News InternationalTenzing
Marketing & CommunicationsFanbytesBrainlabs1
Marketing & CommunicationsMolziBrainlabs1
Marketing & CommunicationsFlagVespa
1. Brainlabs is a Livingbridge portfolio company.

A key driver behind these acquisitions was technology. As technology and people businesses increasingly overlap, hybrid, tech-enabled people businesses can deliver superior and more efficient services to their customers. Services companies that have successfully transitioned to a tech-enabled model, or have built a growing, revenue generating tech-enabled business are highly sought after. Furthermore, corporates are implementing new digital ways of working, a trend accelerated by the pandemic, which has led to an increased need for data engineering and analytics, digital transformation consultancies, and digital marketing.


For more information on any of the projects above, please contact Paddy Woods Ballard, or Patrick Woodrow.

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