HgCapital announces investment in STP

HgCapital, the Manager of HgCapital Trust plc ("The Trust"), today announces an investment in STP Group ("STP"), a leading provider of insolvency and law practice software, based in Germany.

HgCapital Trust plc will invest in STP, alongside other institutional clients of HgCapital, who will participate through the Mercury Fund. The Trust, whose shares are listed on the London Stock Exchange, gives private and institutional investors the opportunity to participate in all HgCapital's investments. The Trust will contribute a total of approximately £6.6 million.

This acquisition represents the ninth investment by the Mercury Fund and, following completion, the Fund will be approximately 64% invested.

Based on the 30 April 2016 reported NAV, the Trust's liquid resources available for future deployment, including all announced transactions and the proposed dividend payable in May 2016, are estimated to be £16.3 million (3% of the 30 April 2016 NAV). In addition, the Trust has access to a £40 million standby facility, which is currently undrawn. The transaction will reduce the Trust's outstanding commitments to invest in HgCapital deals to approximately £94 million (18% of the 30 April 2016 NAV).

HgCapital announces investment in STP

10 May 2016: HgCapital has today announced an investment in STP Group ("STP"), a leading provider of insolvency and law practice software, based in Germany, in partnership with the current CEO and co-founder Gunther Thies.  Mr Thies retains a significant interest in the business and will continue as CEO. The investment was made from HgCapital's Mercury Fund which focuses on backing growth buyouts in software and technology sectors in Europe. The terms of the transaction were not disclosed.

Founded in 1993 and headquartered in Karlsruhe, Germany, STP employs c.160 people serving over 1,200 legal customers with critical software. STP software supports professionals in both insolvency and commercial law sectors in Germany and central Europe and the company has a strong track record in product development, customer service and innovation.  It has grown revenues every year since founding from its mainly subscription business model.

The investment in STP reflects a continued focus at HgCapital in supporting application software and data businesses built and led by European entrepreneurs.   Accessing HgCapital's sector knowledge as well as the opportunity to join a powerful community of relevant technology companies allows for a valuable partnership between HgCapital and the entrepreneurial leaders that it supports.

This represents the ninth investment from the Mercury Fund and the second fund investment in Germany in the last year following other recent investments in France and Denmark.  Close collaboration between sector teams operating from Munich and London allows HgCapital to locate and then support such investments across Europe.

Arno Poschik, Director of HgCapital in Munich, said:

"We are delighted to be partnering with Gunther Thies and his management team.  STP is a high-quality business that offers attractive growth prospects and is strongly valued by its customers.  HgCapital has a strong track record of investing in business critical software and we look forward to supporting the continued development of STP into a European legal software champion."

Matthew Brockman, Head of the Mercury Fund, said:

"HgCapital first identified STP as a high quality business over eight years ago when we first met Mr Thies and have followed his success since then.  STP is a strong software company and this investment is a perfect example of how we seek to back strong entrepreneurs like Gunther Thies as an active partner helping them to scale high-quality European technology companies."

Gunther Thies, Co-founder of STP, said:
"We are very pleased to be partnering with HgCapital who have demonstrated a deep understanding of our business. We look forward to developing this partnership as we take our next strategic steps."

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About HgCapital Trust plc

HgCapital Trust plc is an investment trust whose shares are listed on the London Stock Exchange (ticker: HGT.L). The Trust is a client of HgCapital, giving investors exposure to a portfolio of high-growth private companies, through a liquid vehicle. New investments and existing portfolio companies are managed by HgCapital, an experienced and well-resourced private equity firm with a long-term track record of delivering superior risk-adjusted returns for its investors. For further details, please see www.hgcapitaltrust.com

Neither the contents of HgCapital's, HgCapital Trust's or STP's websites nor the contents of any website accessible from hyperlinks on the websites (or any other website) is incorporated into, or forms part of, this announcement.