Business & Financial Services
|Sector||Business & Financial Services|
|Investment date||April 2012|
TransUnion is a global risk information provider, founded in 1968, which employs more than 5,100 people, working in 30 countries worldwide. In the United States, it is best known for its credit reporting agency business, and offers its CreditVision®, IDVisionSM, DecisionEdge® and PramaSM suite solutions to global customers. The company provides consumer products in India, Hong Kong, South Africa and Canada through direct and indirect channels. TransUnion went public in 2015 with a valuation of $4 billion; the stock price has more than doubled from its $25.40 IPO share price.
Advent’s extensive experience in the financial services sector and its global reach enabled TransUnion to grow through a series of 15 successful acquisitions after its 2012 investment. Advent identified TransUnion as a company ready to embark on global expansion and, along with Goldman Sachs PIA, acquired the company from Madison Dearborn Partners and the Pritzker family with a 49.4% stake, each.
From the initial investment until its final divestiture in November 2017, Advent supported a global growth strategy based on both acquisitions and organic growth. TransUnion bolstered its data solutions in each of its core verticals – financial services, insurance, and healthcare – and established itself as a leading market innovator. It now operates in 30 countries across North America, Africa, Latin America and Asia and its expansion strategy focused on high-growth economies such as Brazil, India, Colombia and other Latin American countries.
AN IT BOOST, AND A GLOBAL STRATEGY
A global investment in TransUnion’s IT infrastructure was a crucial element in its successful expansion, says Chris Egan, an Advent Managing Director who helped plan and execute TransUnion’s growth path over the firm’s five-year investment.
“The information technology infrastructure upgrade gave TransUnion the ability to organize and process the high volumes of data that allowed the company to improve delivery speed, broaden its availability and bolster its product development, all while reducing its cost structure in terms of operating expense and capital expenditures,” he says.
Part of the accelerated growth strategy included making several key acquisitions that required close coordination between Advent deal team members in the Boston, Brazil and India offices. Those included a stake in an Irish digital verification company, India’s leading credit bureau, a majority stake in one of Colombia’s leading credit bureaus, a US-based password management solutions providers, and criminal and healthcare data operations. TransUnion also added customized analytics solution providers to round out its service offerings. Concurrently, it refinanced debt, listed shares publicly and held secondary share offerings.
PERFECTING THE PLAYBOOK
Advent’s extensive sector expertise prepared its team for the cross-border expansion approach TransUnion took, blending organic growth and acquisitions. Earlier transactions like the 2009 and 2010 carve-outs of Vantiv and WorldPay, respectively helped the deal team craft an ambitious value creation plan and execute it with a blend of operational improvement, international growth, new products and expanding its transaction identification services, as well as bolstering its insurance and healthcare-related businesses.
“Advent was able to help TransUnion execute several initiatives designed to drive strong growth over the long term,” says CEO Jim Peck. “With their help, we made eight successful acquisitions in the three years leading up to the company’s 2015 IPO, which helped growth in the key Brazilian and Indian markets. We also made TransUnion the only provider of scale with both public records and regulated credit data.”
Those deals involved acquiring both complete and partial stakes, and included:
CIFIN – the #2 credit bureau in Colombia
Credit Information Bureau (India) Limited - India's leading credit information bureau
Drivers History Information Sales - an information provider of court traffic violation data to the automobile insurance industry.
eScan Data Systems – a healthcare information company that aids providers in identifying patient coverage after care is administeredL2C – a pioneer in the use of alternative data to develop predictive analytics
TLO – a data solutions provider of custom, scalable investigative and risk management tools used for due diligence, threat assessment, identity verification, fraud prevention and debt recovery
ZipCode - one of Brazil’s largest independent information management providers, specializing in registry data used for credit, fraud prevention and marketing.
TransUnion priced its initial public offering in June 2015, and its share price more than doubled, climbing roughly 140% by the time Advent made its November 2017 exit. The successful formulation and execution of our value creation plan generated substantial growth of the business, in part through the implementation of best practices in pricing and salesforce effectiveness across business lines and geographies. The results reflected increasing strength at the time of Advent’s exit, seen clearly in its third-quarter 2017 results, where total revenue grew by 14% compared with the third quarter of 2016 and adjusted EBITDA grew by 17% over the same period.