Oakley seeks more than €1bn to continue hold on German university group

Oakley acquired a majority stake in IU Group in 2017 via €800m Oakley Capital Private Equity III fund, alongside a number of underlying Fund III investors.

Pan-European mid-market investor Oakley Capital is out seeking to close its first single-asset secondaries transaction, Secondaries Investor has learned.

The London-headquartered firm is seeking a continuation fund of €1.2 billion in size for German university group IU Group, according to three sources familiar with the transaction. The process is still in the early stages with no buyers selected, according to separate source.

The deal would mark Oakley’s first continuation fund transaction.

Lazard is understood to be advising on the transaction.

Oakley acquired a majority stake in IU Group in 2017 via its €800 million Oakley Capital Private Equity III fund alongside a number of underlying Fund III investors, according to a statement at the time.

The business, which was acquired via a corporate carve-out, was formerly known as Career Partner Group. Fund III initially invested €85 million in the business, with the transaction partly funded by a unitranche debt facility from BlueBay, the statement added.

IU Group, which has more than 100,000 students, delivered a student intake compound annual growth rate of 63 percent between 2019 and 2021, according to Oakley’s website.

Oakley declined to comment. Lazard did not respond to a request for comment by press time.

Speaking on the topic of continuation funds, Oakley partner Rebecca Gibson told affiliate title Private Equity International in February that the firm considers every opportunity and avenue for value creation in the market.

“We’ve seen a number of continuation fund vehicles which… provide a route either for a portfolio or a single-asset and those can be attractive when the alignment is right and when you’ve got the right asset in these portfolios,” she said, adding she anticipates that will continue.

Asked whether Oakley had ever used a continuation fund at the time, Gibson said the firm hadn’t to-date.

“We are always considering every opportunity and avenue for value creation in the market,” she said. “We’ll look at everything on a case-by-case basis and make sure that we’re looking to maximise returns for our investors and look after the interests of the management team and the business itself.”

Single-asset deals comprised around 40 percent of GP-led secondaries volume last year, down from 52 percent the prior year, according to Lazard‘s Secondary Market Report 2022. Multi-asset continuation funds grew from 31 percent in 2021 to 34 percent last year.

– Adam Le contributed to this report