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AGIC Capital acquires a majority stake in Farsound

AGIC Capital acquires a majority stake in Farsound
15. July 2019 mucagic
  • AGIC Capital acquires majority stake in Farsound, a leading provider of technology enabled supply chain solutions to the aircraft engine maintenance, repair and overhaul (“MRO”) market
  • Farsound’s distinctive business model, long term customer relationships and positioning in a growing, resilient market make it a highly attractive investment proposition
  • AGIC Capital has invested alongside the management team, led by Kevin Sargent to accelerate Farsound’s growth globally and particularly in the fast-growing Asian market

(London and Hong Kong; 15th July, 2019) AGIC Capital, the European-Asian private equity fund focused on investments in high quality industrial and medical companies today announced the acquisition of a majority stake in Farsound Limited and its subsidiaries (“Farsound”), a leading provider of technology enabled supply chain solutions, from its current owner Rubicon Partners at a total Enterprise Value of £115m.

Farsound was established in 1986 and is headquartered near London, UK with locations across North America, Europe, Middle East and Asia. It supplies fast moving B-class and C-class components to aircraft engine MRO facilities globally. AGIC was attracted to Farsound’s market leading delivery performance and ability to generate real savings for customers, which makes it a strategic partner for many leading engine MRO providers and underpins long term relationships with those customers.

Partnering with the management team, AGIC will support Farsound’s continued international growth, particularly in Asia. Within Asia, China has become the fastest growing market for commercial aerospace and will continue to drive significant demand for MRO services across the region.

The acquisition of Farsound marks another milestone in the continued development of AGIC and builds on the successful track record already established in AGIC Fund I.

Farsound has developed a highly distinctive business model, built long term customer partnerships and established itself as a leader in a large and growing market. Farsound’s significant growth potential is underpinned by structural growth in the global commercial aircraft fleet, particularly in Asia where economic development and demographic changes are driving huge demand for air travel. The trend towards greater outsourcing by MRO providers supports the potential for Farsound to grow ahead of the market” said Ben Mitchell, Vice President of AGIC.

Sam Breuning, Partner and Head of UK of AGIC, added: “We are delighted to have made the investment into Farsound and to be backing Kevin Sargent and the team to deliver the next phase of growth. The acquisition of Farsound exemplifies AGIC’s investment strategy, to partner with the management teams of outstanding European SMEs which have significant growth potential in Asia and to provide proactive, hands on support to realise that potential.”

Kevin Sargent, Executive Chairman of Farsound, said: “Farsound is a global business with numerous opportunities to grow globally. AGIC’s focus on international growth and ability to provide hands on support in Asia is of tremendous value to me and my team. We regard this investment as a key milestone in Farsound’s journey to establish itself as the clear leader in the supply of C-class parts to the aircraft engine MRO market.”

Financing facilities for the deal were provided by BlackRock, HSBC and Investec.

AGIC was advised by PwC (FDD), EY Parthenon and Renaissance Advisors (CDD), KPMG (Tax DD and Structuring), Jones Day (Legal), JCRA (Risk management) and Arthur .J. Gallagher (Insurance)