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3i makes a 2.1x return on the sale of its stake in TouchTunes

3i Group plc (“3i”), and funds managed by 3i, today announce the sale of their stake in TouchTunes (“the Company”), the largest in-venue interactive entertainment network in North America, to Searchlight Capital.

In sterling terms, the total proceeds to 3i Group and funds represent an IRR of 22% and a 2.1x money multiple on the original investment of £24 million ($40 million).

Proceeds to 3i Group from today’s transaction will be £38 million ($57 million), representing a 24% uplift against a value of £31 million at 31 March 2014.

3i, and funds managed by 3i, invested in TouchTunes in 2011 to support the Company’s growth strategy and international expansion, as well as help bolster its product and service offering. During this period TouchTunes has increased its network of digital jukeboxes by nearly 50% and developed several ancillary revenue streams.

The Company now has a presence in over 71,000 restaurant and bar establishments across North America and Europe. This impressive growth has been achieved through organic growth in North America and the important acquisition of Soundnet in 2014, which marked TouchTunes’ entry into the UK market.

Ken Hanau, Managing Partner, 3i North America, commented:
“TouchTunes has achieved significant growth over the past four years. The Company now has a valuable platform in the UK as well as a substantially increased presence in its core market of North America. We have enjoyed working with the TouchTunes management team and are confident that the Company will continue to develop under their leadership.”

Charles Goldstuck, Chairman and Chief Executive Officer of TouchTunes said:
"We have enjoyed tremendous success together over the last four years. Our association with 3i has helped propel TouchTunes into the global arena and I am thankful for their network and support, which has played a big role in our expansion efforts."

-Ends-

Download this press release as PDF

For further information, contact:

3i Group plc (UK)
Kathryn van der Kroft
Tel: +44 20 7975 3021
Email:kathryn.vanderkroft@3i.com

Latika Shah
Tel: +44 20 7975 3157
Email: latika.shah@3i.com

Stanton PRM (US)
Charlyn Lusk
Tel: +1 646-502-3549
Email: clusk@stantonprm.com

Notes to editors:

About 3i Group

3i is a leading international investment manager focused on mid-market private equity, infrastructure and debt management across Europe, Asia and North America. For further information, please visit: www.3i.com

About TouchTunes

TouchTunes is the largest in-venue interactive music and entertainment platform, featured in over 71,000 bars and restaurants across North America and Europe.

Our platform provides location-based digital solutions that encourage social interactions through shared experiences. Music is at the core of TouchTunes’ experience with millions of songs played daily across the network and a mobile app that lets users find nearby jukebox locations, create playlists, and control the music in-venue directly from their phone. The mobile app is available on the iOS and Android platforms and has been downloaded over 3.5 million times.

TouchTunes' award-winning products and services also include an integrated photo booth, the first fully licensed commercial karaoke system and an interactive TV messaging and engagement solution. The network also serves as a highly scalable digital out-of-home activation platform that provides powerful advertising and promotional opportunities for consumer brands.

TouchTunes is headquartered in New York City, with offices in Chicago, IL, Montreal, Quebec and London, U.K. Visit us at www.touchtunes.com.

Advisers

Moelis & Company acted as financial adviser to TouchTunes. Kirkland & Ellis acted as legal adviser to 3i.

Regulatory information

This transaction involved a recommendation of 3i Corporation, a US wholly owned subsidiary of 3i Group. It should not be assumed that recommendations made in the future will be profitable or will equal the performance of the securities in this release. For data relating to other assets involving a past recommendation by 3i Corporation please go to our website.

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