Hellman & Friedman explores sale of Applied Systems for $10B

by@Reuters

Summary

Private equity firm Hellman & Friedman is considering the sale of Applied Systems, a Chicago-based insurance software provider, which could potentially value the company at up to $10 billion. This comes as part of an increased sell-side activity in the software sector, following a quiet period, with other companies like Foundation Software and Finastra also exploring sale options amid improving market conditions. Hellman & Friedman acquired Applied Systems for approximately $1.8 billion in 2014, and the software company currently generates over $550 million in annual earnings before interest, taxes, depreciation, and amortization. The sale process is being facilitated by investment banks JPMorgan and Goldman Sachs, and has already attracted interest from prospective buyers.

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$JPM$GS

Analysis

JPMorgan: JPMorgan is a major global bank offering investment banking, advisory, and capital markets services. It is serving as one of the lead advisers alongside Goldman Sachs on the potential sale of Applied Systems. Goldman Sachs: Goldman Sachs is a leading global investment bank and financial services firm providing advisory and transaction support. It has been retained by Hellman & Friedman to assist with the sale exploration for Applied Systems. Applied Systems: Applied Systems is a Chicago-headquartered provider of software solutions for insurance agencies and brokerages, supporting customer relationship management, policy administration, and related workflows. The company is central to the reported sale process being explored by its owner, Hellman & Friedman. Hellman & Friedman: Hellman & Friedman is a private equity firm that focuses on investments in software, financial services, and other sectors. In this news, the firm is actively exploring a sale of Applied Systems, engaging investment banks to manage the process and attract buyer interest. Deal Context: The process for Applied Systems is drawing interest from prospective buyers and involves major investment banks. M&A Activity: Sell-side activity in the software sector has increased in recent weeks after a period of relative quiet. Sector Trends: Several other software companies have recently launched sale processes or weighed strategic options amid improving market conditions.

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