?? January 2025: European HRTech Investment Update - M&A ??

2025 kicked off with several interesting transactions and M&A activity in the HR Tech market is expected to increase this year as discussed by several analysts and market observers.

In January, we see the consolidation continue - often based on some of the below listed consolidation reasonings:

• HR suite vendors are adding point solutions to their portfolio
• Talent acquisition vendors see faster changes with well-funded GenAI solutions entering the market and are broadening their proposition
• The payroll outsourcing and software continue with their consolidation with some payroll-focused vendors entering broader HR Tech offerings
• Previously specialized employee benefits vendors broaden their portfolio offerings and are continuing to push for a multi-benefit platform play
• Selected consolidation between scale-ups and start-ups continues with some start-ups struggling with standalone GTM in more challenging economic environments

Based on these developments, there quite a few interesting European and also some global #HRTech deals recorded. Here is the summary:

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?? Zellis (UK) backed by Apax acquired elementsuite (UK) which is an AI enabled HR and workforce management software company making it the second acquisition after Benify in September 2024. elementsuite will be combined with Zellis, the largest provider of payroll and HR software to the UK and Ireland, creating an end-to-end AI-powered HR and Payroll platform: https://www.elementsuite.com/articles/zellis-acquires-elementsuite-in-complementary-expansion-of-ai-powered-hcm-suite/

?? Cegid (FR) backed by Oakley Capital and acquired sevdesk (DE) a micro and SMB-focused vendor of pre-accounting, accounting, e-invoicing, and online tax declaration software solutions in the German speaking market. The acquisition underlines Cegid's ambition for its pan-European growth strategy in the SMB segment with this acquisition in Germany after acquisitions in Portugal, Spain and France: https://www.cegid.com/global/news/cegid-expands-its-european-presence-with-the-acquisition-of-sevdesk/

?? Epassi (FI) acquired i-gb // Initiative - Gesunder Betrieb GmbH (DE), a provider of motivational employee benefit solutions in Germany. The integration of i-gb into the Epassi family complements the Group’s existing operations in Germany, which include Hansefit and Fitbase Institut für Online Pr?vention GmbH, both acquired in February 2024. With this latest acquisition, Epassi continues to expand its footprint and enhance its ability to provide comprehensive, technology-driven employee benefit solutions: https://www.epassi.com/news/epassi-group-expands-presence-in-germany-with-the-acquisition-of-initiative-gesunder-betrieb-gmbh?utm_campaign=SoMe%20content&utm_source=linkedin&utm_medium=social

?? VEDA GmbH (DE) backed by Investcorp acquired blink.it (DE), a learning management system and blended learnings vendor. The acquisition expands VEDA's product portfolio in the Learning & Development space with an the LMS solution and follows its strategy to expand the product portfolio with additional complementary offerings: https://www.blink.it/en/blog/blink-it-joins-veda

?? TravelPerk (ES) acquired Yokoy (CH), a spend management platform, and also communicated a $200M Series E financing round at a $2.7bn valuation. This acquisition allows TravelPerk to offer a deeper and more unified travel and expense offerings to its clients while expanding its addressable market: https://www.travelperk.com/press-release/travelperk-raises-200m-and-acquires-yokoy/

?? Globally the most notable HRTech deal in January was the communication of the definitive agreement by Paychex (US) to acquire Paycor (US) at an enterprise value of around $4.1bn in an all-cash (????) transaction. Paycor, a provider of HCM, payroll and talent software, has approximately 2,900 employees, serves over 49,000 clients, and supports approximately 2.7 million employees across the United States. : https://investor.paychex.com/news-events/press-releases/detail/778/paychex-enters-into-definitive-agreement-to-acquire-paycor

Congrats to all of those involved in these deals and all the best for the next iteration of the journey!

Let me know if I overlooked something in the comments below! ?

#worktech #mergersacquisitions #transactions #privateequity

Alexander Kuebel Alexander (Sascha) R. Petsch George LaRocque Anita Lettink Jakob Hardt Thomas Otter Alexander Yin Murat Tolga Demiroglu Dr. Ralf Graessler Martin Graichen Fabian Silberer Henrik R. M?ller Toni Stork Ludwig Preller

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