Sponsor: Hellman & Friedman
Enterprise Value: $800 million
Advisor: Seller: Lehman Brothers
Legal Counsel: Seller: Willkie Farr & Gallagher; Sponsor: Simpson Thacher & Bartlett
AlixPartners, the turnaround firm behind the restructuring of Enron, has been sold through a recapitalization that will give
“What we wanted to do was find a partner that understands the business we’re in, and Hellman & Friedman is uniquely positioned to understand human capital businesses,” AlixPartners CEO Michael Grindfors told Buyouts.
Rumors of AlixPartners’ sale have been floating for months, and in July it was reported that Chicago’s
Hellman & Friedman Managing Director Philip Hammarskjold described AlixPartners as a fast-growing business with the capacity for even more expansion through recruiting new talent and building out its existing service lines.
In an economic environment that normally wouldn’t cater to a turnaround shop (considering the positive trends of the last few years), the firm has averaged annual growth of 36% since 2001.
“The company has a balanced portfolio of services that we think will do well in good or bad economic times,” Hammarskjold said. “The beautiful thing is that the company has shown terrific growth over the past five years, so now it’s even better positioned for a period when there’ll be a real boom in restructurings.”
AlixPartners describes itself as a “one-stop shop” for restructuring services. The firm, with offices throughout the U.S., Europe and Asia, built its name working on some of the largest workouts of all time, with roles in the restructurings of WorldCom, Kmart Corp., Refco LLC and Calpine Corp., among others.
It also has a history working with private equity groups, and through its founder, Jay Alix, has often been linked to
However, Grindfors downplayed the Questor relationship, saying, “Questor has always been a separate entity… We have worked with a number of private equity firms across the board.”
The sale of AlixPartners, expected to close in the next three months, is part of Jay Alix’s succession plan. He will stay on with the firm as co-chairman, alongside Hammarskjold, and he will remain the firm’s largest individual shareholder. However, in a statement he described that the deal turns AlixPartners into “a self-perpetuating institution” and creates “an orderly succession” from its beginnings as an entrepreneurial firm.
Lehman Brothers advised AlixPartners on the transaction, while Willkie Farr & Gallagher served as legal counsel. Hellman & Friedman, meanwhile, received legal advice from Simpson Thacher & Bartlett. —K.M.