Originally reported by the Financial Times
In a significant win for the London Stock Exchange and the UK’s capital markets, software group Visma has selected London as the venue for its future initial public offering. At an estimated value of €19 billion, this could be one of the largest tech IPOs in recent years—and a defining moment for Hg, the private equity firm behind the move.
The choice of London comes amid a drought in tech listings and underwhelming capital market performance. The IPO not only breathes fresh life into a subdued exchange but also underscores Hg’s strategic evolution into one of the world’s leading software-focused private equity players, with assets under management set to surpass $100 billion.
Hg: From Mid-Market Generalist to Software Specialist
Founded in 1990, Hg started life as part of Mercury Asset Management and became an independent entity in 2001. Under the leadership of senior partner Nic Humphries, the firm pivoted in 2007 from a multi-sector investment strategy to a singular focus on software. This decision positioned Hg as a pioneer in European tech private equity at a time when few others dared to specialize.
Their landmark investment? Norwegian software firm Visma, first acquired in a defensive play against Sage, which has since grown into a cornerstone of Hg’s portfolio. Uniquely, Hg chose not to exit Visma after a standard hold period, opting instead to roll investments between funds. Though initially criticized for this “Hg selling to Hg” tactic, the strategy has now become industry standard.
Private Equity’s Challenge: Exiting at Scale
Hg’s rise has been powered by high IRRs and strong DPI (distribution to paid-in capital) metrics. However, with bigger funds come bigger exit challenges. Two funds launched five years ago have returned only half their invested capital. With time ticking, the Visma IPO could be a defining test of Hg’s ability to return capital from its larger, more complex investments.
The firm has also pioneered selective borrowing to accelerate distributions, with backers like Blue Owl Capital and Carlyle’s AlpInvest. Though controversial, these loans accounted for around five percent of Hg’s overall distributions, but as much as 50 percent for its 2020 large-cap fund.
London IPO Market: A Crucial Moment
Recent IPOs in Europe, including those pulled at the last minute in Frankfurt, underscore the fragility of the public markets. London has not fared better, with just £160 million raised via IPOs in the first half of the year—the worst showing in 30 years, according to Dealogic.
Visma’s IPO may well revive investor confidence and demonstrate that London can still attract high-quality tech listings. For Hg, this move tests whether their growth model still holds in a climate of rising competition and shifting monetary dynamics.
Portfolio and Exit Landscape
Hg’s portfolio includes several high-valued companies like:
- The Access Group: £9.2 billion (2022)
- IFS: €15 billion (2025)
- Iris: £3.2 billion (2023)
- Team.blue: €4.8 billion (2024)
- Septeo: €3 billion (2024)
- AuditBoard: $3 billion (2024)
Recent exits include:
- Teamsystem: €7 billion (2024)
- F24: Undisclosed
- Argus Media: $4.6 billion (2024)
What It Means for Global Finance and Tech
Hg’s story is one of transformation and bold conviction. Its success reflects the potential of specialist investing and the importance of long-term thinking in private equity. But its next chapter hinges on executing exits effectively.
With the Visma IPO slated for next year, all eyes are on London—and Hg. Can a firm built in the shadows of the City now prove that its home market can still host the world’s next tech giants?
For institutional investors, private equity observers, and tech insiders alike, this is more than a listing. It’s a case study in strategic reinvention.
This article was adapted and originally reported by the Financial Times. For full reporting, refer to their official publication.
