Genstar to buy OEConnection from Providence for more than $1 bln

Genstar Capital will acquire OEConnection for nearly $1.3 billion, sources familiar with the process told Buyouts.

Providence Equity is exiting the investment after a three-year hold, while General Motors and Ford, both minority investors in the company, will retain their stakes, the people said. Each automaker owns 15 percent of OEConnection.

The process, which kicked off in May, attracted the interest of some prominent PE firms, the people said. GTCR and TPG also bid for the company, the sources said.

Cleveland-based OEConnection makes software for automakers and their franchised dealers. Its business includes e-commerce, pricing, supply chain and other components that help automakers and their dealer networks sell more original equipment parts. The company generates about $80 million in Ebitda, the sources said. UBS advised Providence on the sale, they said.

In June 2016 Providence acquired a majority stake in OEC from General Motors and Ford. Since its initial investment, Providence completed two add-ons to the OEC platform. In October 2018 the firm acquired Bluegrasscoms, a U.K.-based automotive business consultancy and service provider. About a year and half earlier, Providence bought Clifford Thames Group, a data management provider for vehicle repair and maintenance.

Based in the city of the same name in Rhode Island, Providence manages more than $40 billion in total capital commitments. The firm focuses on investments in media, communications, education and information industries.

Providence Equity, Genstar, GTCR, TPG and OEConnection did not comment. General Motors and Ford did not return request for comment before press time.

Action Item: Reach Providence’s Form ADV here: