Houlihan Lokey Advises Aleph Capital Partners

Houlihan Lokey is pleased to announce the placement of preferred equity capital as part of the post-close syndication of Aleph Capital Partners’ (Aleph’s) investment in Saber Interactive (Saber). The syndication commenced in September 2024, following the initial closing of the investment, and concluded on 31 December 2024. Houlihan Lokey served as Aleph’s exclusive capital markets advisor.

Aleph is a London-headquartered independent sponsor founded by Hugues Lepic, former head of Goldman Sachs’ Merchant Banking Division in Europe. Established in 2013, its mandate is to provide flexible capital solutions to ambitious companies seeking to unlock their growth potential. Aleph looks to back companies driven by strong secular industry themes, primarily in the telecom, media, and technology (TMT) sectors, working closely with management teams as a long-term investor to deliver value growth. Within that core TMT vertical, Aleph's team of six partners has deployed ~€1.5 billion across 12 assets, investing €100 to 400 million in a concentrated, high-conviction portfolio.

Founded in 2001 and headquartered in Fort Lauderdale, Florida, Saber Interactive is one of the world’s leading independent video game developers across all major platforms, based on original and licensed intellectual property. Saber has a broad portfolio of successful titles, including Space Marine 2 (released on 9 September 2024), World War Z, SnowRunner, Expeditions: A MudRunner Game, Insurgency: Sandstorm, and an exciting slate of upcoming titles including Star Wars: Knights of the Old Republic, Jurassic Park: Survival, John Carpenter’s Toxic Commando, A Quiet Place: The Road Ahead, RoadCraft, and Tempest Rising.

With this investment, Aleph is supporting Saber’s experienced management team, enabling it to accelerate growth initiatives following the company’s carve-out from its publicly listed holding company, Embracer Group AB (NASDAQ:EMBRAC B). Aleph plans to leverage Saber’s 25-year core development expertise, stemming from 3,000 developers spread across 13 tightly integrated studios located in Western and Eastern Europe, the U.S., and South America. The business boasts a de-risked roster of AAA/AA video games in the early commercialisation, pre-launch, or late development stage, providing investors with excellent visibility over cash flow for the coming 24 months.

Aleph engaged Houlihan Lokey's Direct Placements team in London to raise capital for a convertible instrument that enabled Saber to pay off all debt owed to Embracer in connection with its recent management-led buyout. As an unlevered business, the preferred equity instrument thus constitutes the most senior piece of the capital structure, affording investors downside protection in a business already de-risked by its near-term cash flow profile and Aleph’s short horizon to liquidity.

Houlihan Lokey approached investors ahead of the September transaction closing to prepare them for the syndication process. Aleph’s lead co-investor, Crestview Partners, was able to warehouse the entire preferred equity tranche and enabled Aleph to syndicate half of the convertible instrument over time. The Direct Placements team ran an efficient, targeted process, leveraging its deep knowledge of institutional investors and family offices who invest with sponsors in complex scenarios via flexible capital structures. The Houlihan Lokey team generated significant interest from investors, one of which subsequently increased its initial commitment given the unique transaction dynamics and increasingly attractive entry multiple owing to Saber’s sustained financial post-close outperformance.