By Emma-Victoria Farr and Krystal Hu
(Reuters) - Private equity firm CVC Capital Partners is exploring a sale of VelocityEHS for as much as $2 billion, seeking to capitalize on a boom in demand for compliance software in the corporate world, three people familiar with the matter said.
CVC is working with U.S. investment bank William Blair on a sale process for VelocityEHS, which provides cloud-based applications to help businesses comply with environmental, health and safety (EHS) regulations, the sources said.
The buyout firm has requested indicative bids in the coming week for the Chicago-based company and is willing to entertain bids either for control of VelocityEHS or for a significant minority stake, the sources added.
The sources requested anonymity because the matter is confidential. CVC and William Blair declined to comment.
The size of the global EHS market is expected to grow by $2.8 billion from 2021 to 2026, according to a report by market research firm Technavio.
Luxembourg-based CVC bought VelocityEHS in 2017 through its growth equity fund. The business was carved out of Actua Corporation and sold to CVC along with insurance distribution software firm Bolt Solutions for a total of $328 million.
Since then, CVC has expanded VelocityEHS through a string of bolt-on acquisitions, including the purchase of work software vendor OneLook Systems.
VelocityEHS serves more than 19,000 business customers across manufacturing, pharmaceutical and energy industries, including AbbVie and Chesapeake Energy.
(Reporting by Emma-Victoria Farr in London and Krystal Hu in Toronto; Editing by Pamela Barbaglia and Matthew Lewis)