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CVC Acts Fast and Makes First Investment from $3.5Billion Fund

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May 21, 2014

It was only yesterday that we reported on CVC Capital Partners closing their $3.5billion Asian fund, but already the firm has moved to make its first investment from the capital raised.

 

The Wall Street Journal blog reported late last night that CVC has bought The Executive Centre Ltd, with the deal expected to be concluded quickly, by the end of May.

 

The Executive Centre is the leading premium serviced office provider across the Asia Pacific region, with 60 office centres in 20 of the region’s major cities and economic hubs, including Beijing, Shanghai, Hong Kong, Perth, and Sydney.

 

The services provided by The Executive Centre include virtual offices, meeting facilities, and video conferencing. The business says its aim is to help companies that use its facilities to work smarter and achieve greater efficiency within its business model. The Executive Centre has won numerous awards in recent years for excellence in its field.

 

Headland Capital Partners currently own The Executive Centre, with CVC acquiring a majority stake in the business, as detailed in this news release featured on the CVC website.

 

It is unknown how much capital has been invested by CVC, although irrespective of the deal size it is likely this move will give a boost to the private equity marketplace in the region as a whole. As reported on DealMarket Blog in the CVC story from yesterday, private equity firms in the Asian region have been struggling in recent times owing to having high sums of dry powder but few opportunities to invest.

 

The speed of this deal indicates that opportunities are available, although CVC would clearly have been looking at The Executive Group for some time, and it may be the case that their standing in the industry means they are able to get things moving quickly.

 

It is possible that we may see CVC moving other deals forward quickly in the coming weeks as they look to capitalise on the positive PR their fundraising has generated.

 

CVC Managing Partner Roy Kuan and the head of CVC’s Pan Asia team, James Redmayne, released a joint statement, featured in the CVC news release, saying, “We are very excited to have the opportunity to invest in The Executive Centre alongside management. Paul Salnikow and his team have built a first-class business, which provides the highest quality offering in a structurally growing market.

 

We look forward to working with them and using CVC’s capabilities across Asia and beyond, to help take The Executive Centre to the next stage of its development.” Paul Kang, Senior Partner at current Executive Centre owners Headland Capital, added, “Since our investment in The Executive Centre, the business has thrived under the guidance of Paul Salnikow and his team, with the network of centres more than doubling. We look forward to continuing our relationship with the company in the future through our re-investment stake.”

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