The Company and Our Investment
In February 2007, Octopus and the management team sold portfolio business, James Harvard International, to Hays plc. The business was acquired by Hays alongside James Harvard Japan as part of a single joint transaction with an initial cash consideration of £24m and a further earn-out estimated to be £19m over 3 years.
The exits represents an IRR for Octopus of 98% and a cash-to-cash multiple on the initial cash consideration of 2.4x, rising to a potential 3.6x if the full earn out is paid.
Octopus completed the original investment in November 2005.
"James Harvard has significantly out performed the original business plan, more than doubling proforma EBIT in the year since investment. The company has acquired two complimentary business (Exco Consulting and ASA Medical) as well as opening four new offices across Europe. The new partnership with Hays enables the team to accelerate their international growth by leveraging off the Hays office network. Therefore, while this is an earlier exit than we had originally planned, we believe the ultimate returns will be greater than if the business had remained independent."
Chris Allner, Octopus Investments
