Takeover offer for EQS Group

Thoma Bravo has entered into an agreement with EQS Group, under which Thoma Bravo will make a cash offer of € 40 per share. This is a premium of 53% compared to the closing price on November 15, 2023.

Thoma Bravo is a major American private equity investor who has been investing in technology and software companies for over 20 years. The € 40 per share offer values EQS at € 400 million, corresponding to 2024-2025 EV/EBITDA of 24.5x and 16.0x respectively.

The Supervisory Board and the Board of Directors of EQS support the offer and Thoma Bravo will implement an additional capital increase of 10% (€ 40 million) during the takeover to strengthen the financial strength of EQS. Thoma Bravo will not include a minimum acceptance threshold and it already has commitments from 60% of the shareholders in EQS. The transaction is expected to be completed in early 2024, with Thoma Bravo intending to immediately delist EQS.

EValuation Capital has been invested in EQS through the EV Micro Companies Growth Fund since October 2020. EQS is a German company active in the field of digital solutions for investor relations and compliance, including the efficient distribution of all kinds of digital documentation (such as press releases), the facilitation of webcasts and virtual shareholder meetings and reporting systems in the field of compliance. The positioning of EQS is interesting with a strong market share in the home market (DACH region) and a lot of growth potential in other European countries, Asia and the US. The trends regarding increasing regulations and digitalization are important drivers for strong growth in the coming years. With revenue mainly from SaaS (Software as a Service) based multi-year contracts, EQS offers strong predictability and a high degree of recurring revenue and profit. The prospects for EQS are excellent and the introduction of the whistleblower scheme in European legislation will further accelerate growth.

Given the expected growth in the coming years, we are sorry to see this great company leaving the stock exchange. At the same time, we believe that the offer does justice to the favourable prospects of the company. For the EV Micro Companies Growth Fund, this investment has delivered a return of 66%. This offer is also an indication of the very significant undervaluation present in the small/micro cap segment of the market. This has clearly attracted the attention of private equity. This is the second takeover in the portfolio and we expect that this will not be the last bid for a company in the EV Micro Companies Growth Fund.

Amsterdam, November 25 2023

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Profile EValuation Capital Management

EValuation Capital Management is the fund manager of the EV Smaller Companies Fund and EV Micro Companies Growth Fund and is supervised by the AFM and DNB. It has an experienced investment team which, in addition to the founders Charles Estourgie and Willem de Vlugt, consists of Dirk Verbiesen, Patrick de Pont, Mathieu van Oosterhout and Jorrit Neijenhuizen.

This team has more than 100 years of combined experience in investing in small listed companies. Both funds include family offices, wealthy individuals and specialized asset managers among their participants. The team participates in both funds.