eBay Acquires Advent Portfolio Company Zong for $240m

We are delighted to report the following exit for the Advent Private Equity Fund IV (APEFIV) portfolio:

  • eBay has announced today, July 7 2011, that it has agreed to acquire Zong SA for $240m in cash. Zong is a leading provider of payments through mobile carrier billing and its combination with Paypal creates a global leader in mobile payments and digital goods.
  • APEFIV backed Zong four years ago, investing in Swiss company Echovox from which Zong was spun-off in 2009. Advent was instrumental in focusing the business on using its telco billing relationships as a platform for monetising digital goods and services, and successfully expanding to the US market. Zong has since grown into a leading mobile payments platform offering a frictionless payments experience to over 3bn mobile users around the world and over a thousand digital merchant sites including Facebook.
  • Total APEFIV proceeds of £24.2m ($38.9m) represents a 7.7x return based on the original investment of £3.2m (NAV at the time of spin-off from Echovox), and an IRR of 60.7%, assuming a full release of the 15% escrow.
  • This is the third exit from a growth-stage investment by the Advent Tech team in 2011, underlining the team’s successful focus on growth equity:

- The Foundry sold to Carlyle after a 21-month hold period

- Dailymotion sold to Orange after a 4-year hold period

- Zong sold to eBay after a 4-year hold period

These exits have generated over 6x invested capital on average and in aggregate returned over 1.5x the total amount invested in the Tech portfolio of APEFIV.

For more background on the Zong investment please read our bog: http://www.adventventures.com/tech-blog/97-why-we-invested-in-zong

The transaction is subject to regulatory approval in the US and is expected to close in the third quarter of 2011.
 
Please feel free to contact Frederic Court with any questions regarding Zong on: +44 (0) 207 932 2100 or at frederic.court@adventventures.com.

 

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