Following on the heels of a string of successful realizations in 2004, Chicago-based private equity firm GTCR Golder Rauner is preparing for a $230 million (€175 million) initial public offering of portfolio company Verifone, a credit card transaction processor, according to documents filed with the Securities and Exchange Commission.
The IPO filing comes just seven months after GTCR recapitalized the San Jose, California company and generated a shareholder dividend of approximately $110 million.
GTCR acquired a majority of the company, reportedly 65%, from investment firm Gores Technology Group in a June 2002 deal valued at $165 million. According to the IPO filing, the initial transaction was financed with $95 million of debt.
Founded in 1981, Verifone was acquired by computer giant Hewlett-Packard in 1997 before being sold to Gores in 2001. The company generated significant operating losses in 2001 and 2002 before a turnaround to profitability following the GTCR acquisition.
The Verifone IPO follows a busy year of liquidity events for GTCR, which successfully sold, recapitalized or took public four other portfolio companies in 2004. The firm generated four times its initial $62 million investment when the merger between publicly-traded portfolio company DigitalNet Holdings and BAE Systems closed in December. That followed the September announcement of a stock sale valued at more than $80 million of data communications provider TNS and a reported $70 million dividend from the recapitalization of insurance broker Alliant Resources in August. And in February, in partnership with investment firm The InterTech Group, GTCR sold filtration products company Polypore to Warburg Pincus for a return of 30 times its initial investment.
GTCR was founded in 1980 and currently manages over $6 billion in capital. The firm is currently investing a $1.85 billion fund which closed in June 2003.