Teneo said to be hunting new backers at $2bn valuation

8th Nov 2024 11:28

(Sharecast News) - Advisory firm Teneo - which managed the insolvency of Bulb Energy in 2021 - is reportedly kicking off a hunt for new backers in a process that could value it at about $2bn (£1.5bn).

According to Sky News, US-based Teneo has begun approaching prospective investors in recent days to gauge their appetite to buy a major stake in the company.

One private equity source told Sky that Teneo was working with advisers, said to be Guggenheim Partners, on the process.

Teneo has become a sprawling advisory firm, spanning public relations, restructuring and other areas of corporate consulting and strategic advice. It employs hundreds of people in London, with clients including Saudi Arabia's sovereign wealth fund, the DIY retailer Kingfisher and Clayton Dubilier & Rice, the global buyout firm.

The company has been backed by private equity firm CVC Capital Partners since 2019. Prior to that, BC Partners, another investor, owned a stake in the business.

Teneo has grown rapidly through a string of acquisitions, the most notable of which was the purchase in 2021 of Deloitte's UK restructuring arm.

Since then, the division has worked on the special administration of the collapsed energy retailer Bulb - the first such process of its kind in the UK - and the insolvency of the UK arm of Russian bank VTB, which was hit by the imposition of sanctions following Vladimir Putin's invasion of Ukraine.

Teneo has also bought a number of smaller restructuring firms, including Goldin Associates in the US and Credo in the UK.

CVC is understood to own a majority stake in Teneo, and Sky said it was unclear on Friday whether it would seek to offload all of its interest or remain a shareholder after any new investor backs the business.

A number of parties are understood to have begun being sounded out, with one of those approached saying that Teneo's growth trajectory meant that it was likely to attract a significant level of interest.

The process is unlikely to conclude until sometime next year, they said.

Sky said Teneo is understood to be on track for a record year in financial terms, with its financial advisory business driving a significant proportion of its improvement in revenue and profit.

It is chaired by Ursula Burns, the former chairwoman of Xerox Corporation and one of the most prominent Black businesswomen in the US.

The company was founded by Declan Kelly, an influential adviser to numerous American CEOs who was forced to resign in 2021 following allegations of drunken misconduct at a concert in California.