The top global private middle market equity firm, HGGC Global has been on an aggressive expansion bid lately. This expansion bid is being fueled by the firm’s need to grow itself both financially and strategically. From a financial standpoint, this middle market private equity firm wants to increase its revenues. On the other hand, from a strategic perspective, the firm seeks to position in a better place to attract lucrative deals and partnerships. This firm’s expansion bid has led to it purchasing a top patent risk management services provider, RPX.
A wonderful deal
RPX was founded in 2008 and since this time it has been purchasing the most promising patents from all over the world. Today, this patent management services provider boasts of having more than 23,000 very promising patents under its care. RPX has spent more than $2,5 billion purchasing these patents. HGGC paid $10.50 per share in cash adding up to a total of $555 million as it had been outlined in the May agreement between the two companies.
This purchase is expected to pay off handsomely given that the middle market private equity firm has a lot of companies under it that could turn some of the patents under FPX into a fortune. There is speculation that this particular opportunity is what fueled this private equity firm to go ahead with this purchase. In this deal, HGGC worked with partners like Jefferies Finance who was the primary lender alongside GCA Advisors and Houlihan Lokey who were the financial advisors.
This private firm dominates the global middle market equity space with an impressive transactional value of over $17 billion and $4.3 billion worth of capital commitments. The firm utilizes the “Advantage Investing” model to push its success. In this model, all the firm’s players such as the management, founders, investors, and staff work together to create a powerful alignment of interests that drive the firm to success. This is a model that many businesses are now imitating thanks to the success of HGGC. Today, this firm has completed over 90 major deals that have propelled it to this success using the model.