Next Capital Fund IV
Next Capital Fund IV is managed by Sydney based Next Capital Management Pty Ltd.
Next Capital Management (www.nextcapital.com.au) was established in 2005 by Sandy Lockhart, Patrick Elliott and John White, who were former principals of Macquarie Bank’s private equity arm, Macquarie Direct Investment Limited (MDI).
MDI raised four private equity funds that generated an average internal rate of return of around 30% from the 33 realised deals at the time of the Partners’ departure.
James Murphy joined the partnership in 2014, following a period as an Investment Director with Next Capital. Prior to joining Next, James’ background is in investment banking and strategy consulting.
The Principals’ extensive private equity experience and strong track record of success attracted the support of blue-chip Australian institutions who invested A$265 million in Next Capital Fund I in 2005.
The A$285 million fundraising for Next Capital Fund II was concluded in 2009, and the A$256 million fundraising for Next Capital III closed in May 2016; each of Fund II and III introduced a number of new blue-chip international investors.
Having completed 50 deals in a variety of industries during their careers, the Next Capital team have a strong track record of working with management to generate returns for vendors, management and investors alike.
Next Capital Fund IV, with a target fund size of $350m, is focused on investing into small to mid-market expansion and buyout opportunities of profitable, Australian & New Zealand businesses, with enterprise value of between $50 million and $200 million at investment.
Next Capital Fund IV has completed six investments to date; Silver Chef, InterHealthCare, TM Insight, Eptec Group, Enviropacific Services Pty Ltd and Jucy
Silver Chef. On 4 December 2019 Next Capital Fund IV announced that they had successfully completed the acquisition of the Silver Chef hospitality business from ASX listed Silver Chef Limited. Silver Chef is a market leading hospitality equipment funding business, operating across Australia, New Zealand and Canada. Following the completion of the acquisition by Next Capital of the Silver Chef assets, the listed company name was changed to SIV Capital Limited.
Established in 1986 by its founder and major shareholder Allan English, Silver Chef provides commercial equipment rental and financing to small and medium sized businesses in the hospitality sector. It offers a range of financing solutions including its popular and successful Rent-Try-Buy product.
Next Capital’s significant experience in the financial services space, including Scottish Pacific (Next Fund II asset) and Alpha Group (Next Fund III asset) means that they are ideally placed to drive the ongoing management of the business and will invest to grow Silver Chef through improving systems and reporting, and applying stronger discipline in risk, credit and compliance across all geographic regions.
InterHealthCare. On 6 December 2019, Next Capital Fund IV completed an initial investment into InterHealthCare Pty Limited (IHC). IHC was established by CEO Jason McMillan for the purpose of aggregating individual allied health practices across Australia to create a market leader of scale.
IHC enters a supportive and mutually beneficial relationship with leading health providers. This enables health professionals to extend their influence by focusing on clinical outcomes and expansion of their business network, whilst IHC takes care of centralised functions. IHC represents all allied health modalities, providing a broad range of health services under a diversified business model.
IHC’s initial portfolio of assets include multi-disciplinary physiotherapy, osteopathy and chiropractic practices in the eastern states of Australia.
TM Insight. On 23 December 2019, Next Capital Fund IV announced to investors that they had come to an agreement to acquire supply chain consulting business, TM Insight (TMI).
TMI is a privately owned company established in 2010 for the purpose of providing supply chain consulting and implementation services to address growing customer needs in fast moving and evolving supply chain solutions.
TMI began as a project management business but over time transitioned to providing critical in demand services including supply chain advisory and property services. The Company has long standing relationships with many blue-chip customers including some of Australia’s largest and most reputable companies in food and FMCG, transport and logistics, retail and property and hotel development. Currently, the Company has over 50 staff across four office locations in Sydney, Melbourne Brisbane and a pending office in Singapore.
TMI operates through four divisions, Supply Chain, Property, Project Services and Commercial and Leisure and offers a unique business model whereby it provides an integrated service across design, procurement, delivery and implementation and this is a key contributing factor to TMI’s success.
Eptec Group. During July 2020, Next Capital IV completed the investment in Eptec Group (“Eptec”), a privately-owned specialist contractor providing asset preservation, life extension and maintenance services to the marine sector (defence and commercial) and other critical transport and infrastructure assets in Australia.
Eptec has a 22-year track record of providing complex, highly technical and time critical asset preservation and maintenance services to the following sectors:
Eptec Services – Specialises in the delivery of time-critical, highly technical and complex projects to primarily government related clients, with its core focus being the transport and infrastructure segment (including bridges, tunnels, rail and ports) and to a lesser degree in waste and wastewater.
Eptec Marine – Specialises in the delivery of asset preservation services throughout the lifecycle of naval defence and marine vessels, and commercial marine operators, from new-build construction through mid and full-cycle maintenance and refurbishment
Eptec’s contracts range in duration from very short turnaround projects such as preservation work on naval ships (lasting one to two weeks and generally structured as a purchase order under a master contract with a prime contractor) to longer term contracts (full cycle docking projects).
The Company currently services the Australian market where it has developed strong relationships with a significant number of blue-chip prime contractors, government agencies and market participants in asset preservation and rehabilitation.
Enviropacific Services Pty Ltd. During November 2020, Next Capital Fund IV announced the acquisition into Enviropacific Services Pty Ltd (“EPS”), a market leading environment remediation specialist delivering tailored engineering and applied science solutions for the prevention and treatment of solid and liquid contamination in Australia.
Founded in 2001 and headquartered in Sydney, EPS operates through two key divisions, Environmental Services and Engineered Solutions, servicing government, infrastructure, urban planning and residential sectors with long standing relationships with many blue-chips customers. EPS also operates its own hazardous waste treatment facility, branded Solve, located in Melbourne, offering thermal desorption technology to treat hazardous solid waste.
EPS represents a highly attractive opportunity in a COVID and post-COVID environment with uncertain economic conditions likely to prevail for a number of years, the exposure to public infrastructure and urbanisation projects (where public spending is likely to rise and be sustained to support employment).
Jucy. In June 2022, Next Capital IV announced an investment into Jucy, a budget car and campervan rental business that hires vehicles to travelers and backpackers across Australia and New Zealand.
Established in Auckland in 2001, Jucy’s camper business is predominantly focused on car and campervan rental, servicing customers across Australia and New Zealand. Next Capital’s investment into the business was reported in the media as approximately $30 million.
Next Capital will seek to position the business to benefit from the expected rebound in Australasian tourism with the reopening of international borders.
Compare Club. During September 2022, Next Capital completed the acquisition in Compare Club (‘CC’), one of Australia’s leading personal finance marketplaces, currently offering comparison and brokerage services across health insurance, life insurance and home loan products.
Originally created in 2017 via the merger of ChooseWell (health insurance sales brokerage business) and Alternative Media (a specialist digital lead generation business), CC has engaged over 3.7 million members over time across its key verticals of health insurance. The business is uniquely positioned in the comparison site marketplace through its data-driven digital marketing and lead generation, and full-service end-to-end conversion and sales capability.
Next Capital are partnering with a high quality management team to organically grow earnings across the business’ three key verticals, explore new channel and product offerings and increase marketing capabilities