“This is a milestone in the company’s almost ten-year history as a specialist in the operation of internet applications. We are getting a solid new owner which will bring us financial and strategic expertise, as well as an even better opportunity to realise our ambitions,” says Grethe Viksaas, CEO of Basefarm.

In addition to Reiten & Co’s holding, the other shares will be owned by Basefarm’s management (23.1 per cent), its employees (4.8 per cent) and Basefarm AS (0.1 per cent). Reiten & Co is paying about NOK 130 million for Schibsted’s 69.4 per cent holding in Basefarm. The sale values the company at NOK 255 million. 

Great potential

It is not Reiten & Co’s way to sit on its hands. This professional owner has a clear methodical approach for exercising active ownership in the portfolio companies.

“The fund invests in companies that have competent management and good potential for further growth. We intend to be an important contributor to the company’s management, to operational improvements and to assessing opportunities for organic and structural growth,” says Christian Melby, partner in Reiten & Co Strategic Investments AS, the fund’s exclusive investment adviser.

Basefarm provides operational services to businesses that use the internet as an important channel for reaching customers, employees and partners. The company had a turnover of NOK 208 million in 2008 and has a subsidiary company in Sweden. Customers include Altinn, TV4, the Police, Norwegian, Canal+, Elkjøp and Dagbladet.  

“Basefarm is an interesting company, which is very well suited to our portfolio and strategy. The company is the strongest in its field in Norway, has delivered good results and has great potential both in Norway and abroad,” says Melby.

Crossing borders

In 2009 Basefarm began a focus on European markets, primarily the Benelux countries.

“We are solidly based in the Nordic countries, but we also have a presence in the wider European market. With Reiten & Co’s expertise and financial strength, we are well equipped for further expansion in our Nordic markets and to get a good grip on the European market,” says Viksaas.  

Basefarm has achieved positive results internationally by winning contracts against stiff competition from other European players. For example, the company operates catalogue services in eleven countries for customers European Directories and Truvo.

Basefarm’s management wanted to have an owner that would provide a good basis for organic growth and that has the resources to perform acquisitions when appropriate.  

“Reiten & Co has the will and the ability to help us with this,” says Viksaas. They have taken the time to really understand our business model, and have expertise that is complementary to our own. We are excited to take the next step in developing Basefarm together with them.

The new board is made up of two representatives from the employees and three from Reiten & Co. Jens Rugseth continues as chairman. Consideration may be given at a later date to expanding the board to include external board members.

About Basefarm

Basefarm is a leader in the operation of business-critical internet applications, with offices in Norway and Sweden and 190 employees. Turnover in 2008 was NOK 208 million, with an operating profit of NOK 17 million. The company provides operational services to businesses that use the internet as an important customer channel. Basefarm specialises in operating internet services with high levels of traffic and complexity, such as portals, web newspapers, streaming services, search services and online shopping solutions. 

About Reiten & Co

Reiten & Co is one of the leading private equity companies in the Nordic countries and consists of an experienced investment team that has together created substantial values. The company has investment experience in many sectors and primarily invests in medium-sized Norwegian and Nordic companies.

Reiten & Co was established in 1992 and since 1996 has established the company’s private equity activities as a Nordic leader, with about NOK 3.5 billion under management. Reiten & Co invests in ambitious growth companies. The company’s investment methods focus on identifying, structuring and actively leading investment projects in attractive companies and industries. Reiten & Co brings to the companies in the portfolio financial and strategic expertise, experience and drive, in combination with capital. The aim is, through interaction between the portfolio company and Reiten & Co, to build good companies and create values through controlled risk.

Since the beginning in 1996, funds advised by Reiten & Co Strategic Investments AS have invested in 18 companies, in industries including oil and offshore services, the food industry, telecom, property and various service industries. Seven of the eighteen portfolio companies have been divested via stock market listing or sale.

In 2008, the portfolio companies had a turnover of NOK 5.3 billion and they have a total of 2,800 employees.

Contact persons

Basefarm

Grethe Viksaas, CEO. Mobile: 9164 2888. E-mail: gviksaas@basefarm.no

Reiten & Co Strategic Investments AS

Christian Melby, Partner. Mobile: 95 81 32 77. E-mail: cm@reitenco.no

Schibsted

Trond Berger, Group Finance Director. Mobile: 916 86 695. E-post: trond.berger@schibsted.no