Advent International is prioritising business and financial services, healthcare, and technology as its looks develop exposure to Australia and New Zealand, according to Beau Dixon, a managing director who leads coverage of these geographies.

The firm is building on the momentum from its recent acquisition of Australian registry and investor administration services provider Automic Group for a reported AUD 725m (USD 471m). The deal, which closed earlier this month, is Advent’s first in Australia since opening a Sydney office in 2024.

The target sectors reflect “where we have a clear right to win and global sub-sector specialisation,” said Dixon, who joined Advent from Anchorage Capital Partners last year. He cited Automic as a clear example of the firm’s investment approach in this region.

Australia’s stable and well-regulated financial system, growing retirement assets, and increasing complex systems and reporting requirements are seen as tailwinds for the business and financial services.

In healthcare, growth areas include aged care services, digital health, biotech services, health information technology, workforce management, and medical devices. The sector is expected to benefit from strong long-term government support and Australia’s aging population.

Attractive sub-sectors within technology include cybersecurity, fintech, healthcare technology, data and artificial intelligence, and industrial software. Dixon noted that Australia’s favourable innovation policies and high-quality talent have already helped launch global tech leaders such as Atlassian, Afterpay, Airwallex and Xplor Technologies. The latter is backed by Advent.

Global to local

These sectors are three of five that Advent focuses on globally. The others are consumer and industrials.

The firm is currently deploying its latest global flagship offering, GPE X, and Advent Global Technology II. GPE X, which closed on USD 25bn in 2022, typically makes investments of at least USD 250m. The USD 4bn technology fund starts at equity commitments of USD 50m, Beau Dixon said.

Advent, which has over USD 100bn in assets under management, is currently in the market raising GPE XI and Advent Global Technology III. AVCJ reported earlier this year that firm is looking to raise a dedicated Asia fund as well.

According to Dixon, cheque sizes in Australia and New Zealand would be consistent with Advent’s commitments elsewhere in APAC, but there is room for flexibility. Moreover, the key determining factor when making investments is business quality, not deal size.

“We focus on companies with clear breakout potential, where we can work closely with management to develop a tailored value-creation plan early and apply our hands-on, in-market and global operational expertise,” he explained.

Advent can support both established businesses seeking a step-change and fast-growing companies looking to accelerate their growth, Dixon added. They could be founder or family-owned, corporate carve-outs or public-to-private opportunities.

With this flexibility in cheque size, the firm operates across a deal spectrum populated by global peers like EQT, KKR, and TPG at one end and larger local GPs – such as BGH Capital and Pacific Equity Partners – at the other.

Prior exposure

While the Sydney office is relatively new, Advent has been active in Australia and New Zealand for more than a decade. In addition to Automic, it has backed resins manufacturer Nuplex Industries, payment services platform Transaction Services Group, and luxury fashion brand Zimmerman.

Transaction Services Group was acquired in 2019 and ultimately merged with Xplor two years later. Other investments have involved more immediate portfolio-level M&A in Australia. Nuplex was acquired in 2016 with a view to folding it into Allnex and Culligan bought Zip Industries in 2017.

In addition, Cobham and Ultra Electronics, two leading UK-based defence, aerospace and technology companies in the Advent portfolio have past and present operations in Australia.

Dixon believes the current market environment rewards discipline and long-term thinking. While volatility is “surfacing high-quality assets that may not have come to market in more stable conditions,” deal parties must have conviction in execution and alignment on realistic timeframes.

“We are seeing a mix of process types in the market,” he said. “In certain situations, there is a shift towards more bespoke or bilateral engagement where the buyer can demonstrate conviction and certainty to vendors.”

Advent is one of several global private equity firms that have opened offices or sought to staff up in Australia in recent years. Dixon regards competition for high-quality assets as a healthy feature of the country’s maturing PE landscape.

“We also view competition for assets from strategics as a positive sign as it validates interest in the assets and sectors we are targeting – both upon entry and for our future exit,” he said.