Information on the Target

Paritee AS (Paritee), founded in 2021 by seasoned industry leader Lars Erik Grønntun, specializes in marketing, communications, and corporate advisory. Grønntun, a former Global President of Hill & Knowlton, along with other experienced professionals, established Paritee to create a collaborative agency network that emphasizes high-value services and deep sector expertise. The company’s initial acquisition was Geelmuyden Kiese, the largest full-service communications agency in Scandinavia, which operates with around 140 employees across Oslo, Stockholm, and Copenhagen.

As part of its expansion strategy, Paritee aims to grow its footprint across Europe by acquiring leading agencies in key markets. Its latest acquisition of Brands2Life, a notable tech-focused strategic communications agency with approximately 200 employees in London, New York, Minneapolis, and San Francisco, marks a significant step in this journey. The founders and key employees of Brands2Life will reinvest in Paritee, aligning their interests with a jointly developed business plan aimed at sustainable growth.

Industry Overview in the Target’s Specific Country

The communications industry in Europe is characterized by a burgeoning demand for integrated communication services, driven by the rapid expansion of technology, energy, and healthcare sectors. As companies increasingly recognize the value of strategic communications in navigating global challenges, the need for expert advisors in this field has intensified. The landscape is composed of a mix of traditional agencies and newer firms that leverage digital capabilities to engage clients effectively.

In the Nordic countries, there is a notable trend towards collaboration among agencies to provide comprehensive services that address complex client needs. This approach fosters innovation and allows for the sharing of best practices across various sectors. Paritee’s model aims to capitalize on this trend by bringing together top talents from different markets while maintaining each agency’s unique identity and entrepreneurial spirit.

The European market also faces challenges, including increased competition and changing consumer expectations. Agencies must adapt to evolving technologies and communicate their value propositions clearly to clients. As business operations migrate to digital formats, the demand for specialized communication strategies tailored to high-value sectors is expected to grow, underpinning the industry’s progression.

With a combined net sales of over €40 million and a workforce exceeding 300 employees post-acquisition, the new agency platform represents a formidable player in the European communications landscape. This growth trajectory is supported by a strategic focus on high-value sectors that are likely to shape the future of communications in Europe.

The Rationale Behind the Deal

The partnership between Explore Equity and Paritee is centered on creating a robust agency platform that can thrive in the rapidly evolving communications landscape. By acquiring Brands2Life, Paritee strategically positions itself to leverage the growing demand for integrated communication services in high-value industries like technology and healthcare.

The collaboration is designed to harness the combined expertise and network of all parties involved, facilitating organic growth through synergistic initiatives and selective acquisitions. This approach aligns well with Explore Equity's investment philosophy, which focuses on driving value creation alongside existing management teams to ensure sustained success.

Information About the Investor

Explore Equity is a partnership equity growth fund dedicated to investing in Nordic firms with strong growth potential. Since its inception in 2016, it has emphasized value creation through meaningful collaborations with management teams and other stakeholders, leveraging over a century of experience across professional and financial services sectors.

With offices in Oslo and Stockholm, Explore Equity draws on its extensive network and sector insights to actively engage in the development of portfolio companies. The firm’s method involves strategic board work and continuous collaboration with management in pursuit of operational improvements and strategic growth initiatives.

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In assessing the investment in Paritee by Explore Equity, it appears to be a strategically sound decision given the current state of the communications industry in Europe. The acquisition of Brands2Life signifies not only a commitment to growth but also a recognition of the increasing need for specialized communication services within burgeoning sectors.

This investment aligns with a trend that sees integrated communication agencies thriving as they cater to diverse client needs, particularly within tech and healthcare. Paritee's unique model of maintaining agency autonomy while fostering collaboration is likely to attract other high-caliber agencies, further solidifying its market position.

Moreover, the strong leadership team at Paritee, bolstered by seasoned professionals with extensive industry experience, provides confidence in the platform’s potential for profitable growth. The commitment from Brands2Life's founders and key employees to reinvest underlines their belief in the shared vision and the potential for success.

Overall, this deal could pave the way for Paritee to become a leading player in the European communications landscape, making it not only a promising investment for Explore Equity but also a significant player in providing high-value services across key sectors.

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