New Delhi, June 25 -- Homegrown private equity firm Multiples Alternate Asset Management, led by Renuka Ramnath, has signed a deal to completely wind up its nearly decade-old investment in the services sector.
The PE, which hit the final close on its fourth fund in 2024 after securing around $850-880 million and raised a continuation fund last year for a clutch of portfolio companies under its second fund, is selling its majority stake in recruitment process outsourcing (RPO) business Taggd to executive search firm EMA Partners India Ltd.
EMA, which is listed on the NSE Emerge platform, is buying Taggd for Rs 113 crore ($11.9 million).
Taggd, operated by Talent Hired-The Job Store Pvt Ltd, was previously part of PeopleStrong HR Services Pvt. Ltd.
Multiples PE had bought an 88% stake in PeopleStrong during 2017-18. It initially paid Rs 240 crore and then pumped in Rs 60 crore a year later for an additional 1% stake. The PE firm participated in further rights issues in three tranches during 2020-2022 to shell out an additional Rs 175-180 crore, VCCircle has gathered.
PeopleStrong demerged its RPO business under Taggd a few years ago with a mirror shareholding. This was apparently driven by the diverging growth trajectories of software-led corporate solutions and pure-play recruitment services.
Last year, PeopleStrong was acquired by Goldman Sachs. The deal was reportedly worth around Rs 1,200-1,300 crore and Multiples PE would have encashed around Rs 1,100-1,170 crore. In the latest transaction for Taggd, the PE firm would pull out another Rs 100 crore, marking the final leg of a dual-exit strategy.
With both exits formally cemented, a look at Multiples PE's investment trajectory shows it charted a modest return on the bets.
Compared with its total investment of around Rs 480 crore, the private equity firm achieved a gross multiple on invested capital (MOIC) of around 2.6x in rupee terms. It clocked an internal rate of return of 15-16% on the investment in rupee terms, as against the 20% benchmark chased in local currency, VCCircle estimates show.
In dollar terms, which would be more apt for Multiples as its second fund from which it had invested in PeopleStrong and Taggd was largely raised offshore, the PE firm is estimated to have generated an IRR of 10-11%, against the 15% benchmark, the estimates show.
Multiples PE did not reply to VCCircle's queries.
EMA's deal rationale
While Goldman Sachs took the wheel at PeopleStrong to scale its automated HR enterprise software, EMA Partners' acquisition of Taggd will create an integrated talent services provider spanning executive search, professional recruitment, and AI-driven talent fulfillment, the company said in a release.
Taggd is one of India's largest homegrown integrated RPO services providers delivering digital and AI-led recruitment solutions at scale. Through its proprietary AI-led platform, TARA (Taggd AI Recruitment Assistant), it has cumulatively delivered more than 700,000hires to over 100 clients across 14 industry sectors.
Following the announcement, shares of EMA Partners surged on the National Stock Exchange's SME platform, closing up 12.4% at Rs 89.35 apiece. This gives the company a market value of about Rs 202 crore. The company listed on the NSE Emerge in January last year. Its shares touched a record high of Rs 158.80 on its debut, compared with the IPO price of Rs 124 apiece, and fell to a record low of Rs 65.25 in March this year.
Looking back at the split, Taggd co-founder Pankaj Bansal told VCCircle, "When you look at the evolution of both entities, the strategic rationale behind their respective partnerships becomes incredibly clear. PeopleStrong was fundamentally a SaaS-led transformation story, making Goldman Sachs the ideal home to scale that vision."
Terming Taggd as a pure-play recruitment and talent search story, Bansal said that growth and impact were deeply synergistic with the executive search and leadership ecosystem. "Partnering with EMA Partners is a highly complementary strategic alignment that directly accelerates our core business," he said.
Published by HT Digital Content Services with permission from VC Circle.