Carlyle Group said it has acquired Snow Phipps’s stake in ZeroChaos to have a stake in the company.
The group said Snow Phipps is exiting its stake after being the major financial partner of ZeroChaos.
The company said the agreement is a substantial investment in ZeroChaos, a global provider of software and services to large corporations in the fast-growing, global workforce management space. The transaction, terms of which were not disclosed, is expected to close in the third quarter of 2017, subject to regulatory approvals.
Headquartered in Orlando, Florida, ZeroChaos provides software and services that help companies manage their temporary staffing, professional services and other outside service providers. As one of the few vendor-neutral platforms of scale, ZeroChaos is not affiliated with any one staffing firm, allowing it to be objective in helping customers choose among multiple competing staffing suppliers, which results in customers obtaining higher-quality talent more quickly and at a lower cost. The company manages more than $3 billion of outside spending in more than 40 countries for customers from a range of industries, including software and IT services, telecom, automotive and healthcare.
ZeroChaos will continue to be led by the company’s current leadership team, including CEO Michael Werblun and COO Matthew Levine, who bring decades of industry experience to their mission of building a global platform in workforce management solutions. Gordon Coburn, the former President of Cognizant, will join the board of ZeroChaos as Executive Chairman.
Cam Dyer, Carlyle Managing Director, said, “ZeroChaos is well positioned to continue its strong growth trajectory through its compelling value proposition, which helps customers save money on their contingent labor, obtain better talent faster, enable C-suite visibility, and support compliance and risk management. We look forward to working with Michael, Matthew and their team to support ZeroChaos in its next phase of growth.”
Carlyle Managing Director Julius Genachowski added, “This investment is an excellent fit for Carlyle, where we’ll work with ZeroChaos’ strong team to leverage our global platform and multi-sector expertise to help scale this award-winning business, which serves an increasingly important need for large and growing companies.”
Michael Werblun, CEO of ZeroChaos, said, “We are excited to partner with Carlyle. We believe ZeroChaos will benefit from Carlyle’s global network and deep industry knowledge and that our customers will gain from Carlyle’s desire to invest in innovation to drive long-term growth. Carlyle has a track record of investing in market-leading software and services businesses and we look forward to a great partnership with them.”
Equity for this investment will come from Carlyle Partners VI, a $13 billion U.S. buyout fund. Carlyle’s experience in the technology and services space includes investments in ProKarma, ION, Veritas, Dealogic, CommScope, Syniverse, OpenLink Financial and SS&C Technologies.
Carlyle Partners VI is part of Carlyle’s Corporate Private Equity segment, the oldest and largest of the firm’s four business segments, with assets under management of $53 billion, as of March 31, 2017. Corporate Private Equity, with 295 investment professionals, operates 30 funds worldwide with investments in more than 150 companies.
Latham & Watkins advised Carlyle. ZeroChaos was advised by R.W. Baird and Weil, Gotshal & Manges.