Alceon Private Equity eyes another exit following Nido IPO

Mid-market private equity firm Alceon has a busy few months ahead of it, with plans for one more exit and a platform deal before the financial year end.

October 19, 2023
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Alceon Private Equity eyes another exit following Nido IPO

James Arbuthnott

Mid-market private equity firm Alceon has a busy few months ahead of it, with plans for one more exit and a platform deal before the financial year end.

Alceon plans to exit one more of its investments this calendar year / Planet One Images/Universal Images Group

Mid-market private equity firm Alceon Private Equity is set for a busy few months with plans for one more exit in its portfolio and the potential for one new platform deal before the financial year-end.

Alceon Private Equity made its seventh exit since inception after the $99.2 million IPO of early education business NIDO this week. And the firm's co-managing director Zac Midalia said plans are advanced for another exit in coming months.

"We're working on another exit for the second half of this financial year. I won't say which company, but we're working through that," Midalia said.

The firm's existing portfolio companies specialty fashion group Mosaic Brands, managed services provider efex, discount retailer Cheap as Chips and private health operator SMS Healthcare.

After a lull in the market from late 2021 to early 2022 owing to rising interest rates and increased costs of capital, Alceon, which has $400 million in funds under management, now sees a firm pipeline of opportunities, he said.

“Our structure allows us to be the most flexible capital on the street. We have a huge balance sheet that we underwrite every deal with and we do every deal in its own fund structure,” he said.

“Our investments are not commingled with other assets, which allows us to customise the deals to the benefit of the vendor to have flexibility around timeframes, minority or majority ownerships, and flexibility around capital structure,” he said.

Alceon Private Equity’s advisory board includes ex-Champ Private Equity MD Ben Sebel, ex-Archer Capital partner Mark Wilson and ex-Ironbridge Capital partner Josh McKean, who are all joined by Alceon Group’s founding partner and MD Trevor Loewensohn.

The firm has been looking specifically at the defence industry of late with its advisor from Arican, Mark Stevens, and has been looking further into the health space with the help of ex-Healthscope CEO Robert Cooke.

Alceon has seen more deal opportunities in healthcare, defence and the niche IT consulting and products space, Midalia said, adding that it may also make another platform investment this financial year.

“I’d say we’d love to do at least one more platform deal,” said Midalia, who is co-MD alongside David Wilshire.

Alceon Private Equity is part of Sydney-based Alceon Group, which has $6 billion funds under management. Alceon Private Equity does not look for large majorities in companies but focuses on partnerships via 50/50 or small minority deals, Midalia said.

It prioritises businesses generating EBITDA of between $5 million and $40 million and looks to deploy from $20 million to $100 million in equity in its investments.

It focuses on the education, industrials, consumer and retail, healthcare and wellness, technology and business services sectors.

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