In November 1987, Cinven supported the management buyout of Hays from its owner KIO. The company operated in specialised areas of the business services sector including controlled temperature distribution, marine transport services, office support services and professional staff recruitment.
The incumbent management was a strong and experienced team with a record of managing companies for profitable growth. The team was headed by an excellent chief executive who Cinven had previously backed successfully.
The markets in which Hays operated were stable and not greatly affected by cyclical trends. The spread of the activities was well balanced and with continued good management the business would achieve good growth and be floated in due course.
In barely two years from the buyout, Hays was floated on the London Stock Exchange. This was achieved as a consequence of the strong profits growth and the high quality of the earnings.
Multiple returned on investment: 3.5x