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Cornerstone Partners and Oaktree acquire ProService Agent Transferowy, a Portfolio Company of Highlander Partners

Warsaw, Poland – March 10, 2016 – Funds managed by Cornerstone Partners and funds managed by Oaktree Capital Management, L.P. (“Oaktree”) have entered into a purchase agreement to acquire ProService Agent Transferowy (“ProService”, “ProService AT”) a prominent player in the business process outsourcing market and a leading transfer agent in Poland.

The agreement for purchase of 100% stake in ProService Agent Transferowy was concluded on 23rd of February 2016. The company will be acquired by a partnership of Cornerstone Partners and Oaktree’s European Principal Group from private equity firm Highlander Partners. The transaction requires consent of Polish competition authority (UOKiK).

ProService Agent Transferowy is a specialized provider of professional support services of transfer agency, accounting, as well as advanced IT solutions for financial institutions domiciled in Poland and abroad. It has operated on the market for more than 20 years.

Paweł Sujecki, CEO of ProService, said, “Our mission is to deliver end-to-end business solutions for the financial industry, tailored to the specific needs of our clients. We value very much the cooperation with our clients, and we will work on further strengthening and expanding of offer for our existing clients. We believe that together with new investors we will expand our presence, capabilities and expertise beyond the borders of Poland. Now it is time for a new chapter in our history.”

At the end of 2015, the company served 52 domestic and international clients and a portfolio of PLN 55 billion of assets under administration. The domestic market on which ProService operates is estimated at PLN 680m as of 2015.

ProService has a headcount of 350 people, including IT specialists, accounting, as well as clearing and settlement advisors.

Artur Dżagarow, Chairman of the Supervisory Board of ProService and Operating Partner at Highlander Partners, added, “Within the last three years we have managed, together with the ProService team, to transform the company from being a service center subsidiary of an important asset manager to an independent service provider, that is currently not only the leader in transfer agency services in Poland, but also a superb fintech platform ready to expand its services for the whole financial industry. We are very satisfied with our investment into ProService, in particular with the value created through extension of our service offer, entering into new business segments as well as building a corporate culture that promotes high commitment of employees together with high efficiency and security of operating processes. We hope that as a result of this transaction, ProService will start a new phase of its growth: international expansion.”

Outsourcing and offshoring (O&O) is a rapidly developing business in Poland, and around the globe.

Jacek Levernes, President of ABSL (The Association of Business Service Leaders) and advisor to Cornerstone Partners and Oaktree on the transaction, stated, “Poland is the international business service sector leader both in Europe and worldwide. The business service industry in Poland already employs 170,000 FTEs and continues to grow at a rate of 15% per year.  The key for the continued growth of this industry in our country is the development and growth of advanced and knowledge based services, exactly as the ones ProService provides.”

Maciej Dyjas, Managing Partner at Cornerstone Partners, added, “A new strategy for the acquired company will be based on organic growth of operational processes for mutual funds, further penetration of insurance outsourcing services as well as continued market consolidation in Poland and selected Western European countries. This is a first step in growing a specialized outsourcing platform dedicated to banking, insurance and asset management clients in CEE and select Western European countries. We believe that ProService with a new, solid investor will be a partner of first choice for financial clients.”

Przemysław Krych, a founder and Managing Partner at Cornerstone Partners, said, “International clients could benefit from the trend of offshoring parts of technological, operational and administrative processes, that are not a strategic core functions to service providers in Poland. It is an opportune time in the industry for a well-capitalized and experienced team to provide business processes outsourcing. We have observed this trend in our other investments, Griffin Real Estate and Echo Investment, where we are one of the largest providers of real estate to BPO companies.”

The acquisition of ProService is the first joint transaction of Cornerstone Partners and Oaktree’s European Principal Group in Poland. Cornerstone is an exclusive partner of Oaktree’s European Principal Group in sourcing, executing and supporting equity transactions in Poland and other CEE countries.

“We are pleased with our partnership with Cornerstone Partners, which brings together global investing experience, local perspective and a best in class management team. They are uniquely positioned to contribute deep strategic expertise as we have already seen from our long term relationship with them through Griffin Real Estate. Our first private equity deal together is a logical continuation of the long term partnership we have already created,” underlines Karim Khairallah, a Managing Director of Oaktree’s European Principal Group.

The partnership between Cornerstone Partners and Oaktree’s European Principal Group invests in private equity transactions in Poland and CEE, with a focus on backing strong management teams to grow and transform their businesses.

Advisors to Highlander Partners were: Rothschild (M&A advisor) and Gessel (legal advisor). Advisors to Cornerstone Partners and Oaktree were: Weil, Gotschal & Manges (legal advisor), EY (financial and tax advisory) and GFA Luxembourg (one of commercial advisors).

About Cornerstone Partners
Cornerstone Partners is an investment platform owned by Przemysław Krych and Maciej Dyjas. Mutual track record of principals at Cornerstone is proved by more than 60 corporate exits with average IRR above 35 percent. Cornerstone Partners focuses on investments in high-potential businesses in order to achieve superior returns within a reasonable period of time. It invests mainly in Poland, while also looking at opportunities in other CEE countries. Smyk, Blue Gas Energy and Multimedia Polska are current assets in Cornerstone’s portfolio. More information on the website: http://www.cornerstone.pl.

About Oaktree Capital Management
Oaktree is a leader among global investment managers specializing in alternative investments, with $97 billion in assets under management as of December 31, 2015. The firm emphasizes an opportunistic, value-oriented and risk-controlled approach to investments in distressed debt, corporate debt (including high yield debt and senior loans), control investing, convertible securities, real estate and listed equities. Headquartered in Los Angeles, the firm has over 900 employees and offices in 17 cities worldwide. Oaktree’s European Principal Group has been investing in Poland since 2006 when it acquired Polmos Lublin. For additional information, please visit Oaktree’s website at http://www.oaktreecapital.com/.

About Highlander Partners
Highlander Partners, L.P. is a private investment firm with over $1 billion of assets under management and offices in Dallas, TX and Warsaw, Poland.  The firm focuses on making investments in businesses in targeted industries in which the principals of the firm have significant operating and investing experience, including basic manufacturing, food, chemicals, building materials, consumer products, and more. The firm focuses on building businesses with strong operations, sound track records, and high growth potential. Highlander’s European office was set up seven years ago and originally acquired a 100% stake in ProService in November 2012. For more information, visit www.highlander-partners.com.