The growth of the corporate welfare is global, and North America is expected to be the largest market. But Europe is also on the move. In anticipation of this unprecedented development, Epassi Group is creating the largest digital multi-benefit provider for companies and employees in Europe, expanding into Germany and the Netherlands through the transformational acquisition of Exercite by Waterland. This expansion follows a majority investment in Epassi by TA Associates and Warburg Pincus LLC, leading global private equity firms focused on investment in growth.
Never before has the world of welfare seen such a relentless evolution as in 2023. According to a recent estimate published by HTF Market Intelligence, the global corporate welfare market is expected to grow at an annual rate of 4.5%, reaching a market size of nearly USD 72 billion by 2029 (+36% in 5 years). But that’s not all: according to a recent study by Astute Analytica, which focuses on the benefits platform segment, this market will also grow significantly at a rate of 8.1% by 2031, reaching $1.9 billion (+98%). These numbers are the basis of the steps taken by the Epassi Group which is set to become an even stronger European leader as it continues to expand following the acquisition of 100% of the Italian company Eudaimon in July 2023. Already the market leader in digital employee benefit payments in Northern Europe, UK and Italy, Epassi is also expanding into Germany and the Netherlands with the strategic acquisition of Exercite, a provider of corporate welfare services related to wellness and health. This expansion follows a majority investment in Epassi by TA Associates and Warburg Pincus LLC, leading global private equity firms focused on growth investments.
The merger between Epassi and Exercite therefore creates one of Europe’s largest private providers of employee benefits by adding over 7,000 corporate partners and over 11,000 traders to its already extensive portfolio. Once the acquisition is fully completed, Epassi will be able to serve over 20 thousand companies in 7 European countries: Germany, Finland, Sweden, Italy, the Netherlands, the UK and Ireland. Employees will therefore be able to choose and benefit from a range of services that can be purchased through corporate welfare that exceeds 73,000 offers. Epassi CEO Pekka Rantala said: ‘Access to health and wellness solutions has become a priority for employers in order to recruit and retain talent within the company. Through this acquisition, we aim to become the leading pan-European provider of multi-benefit services and this transaction will be a priority. This transaction marks the beginning of our next growth objective’.
Epassi will provide a multi-benefit digital platform that will enable it to offer the best solutions to customers, employees and traders. Warburg Pincus director Issam Abedin said: ‘Mergers and strategic acquisitions are central to TA and Warburg Pincus’ investment strategy for Epassi and will continue to move forward to drive value creation through the platform. Exercite is a strategic acquisition as it significantly accelerates Epassi’s long-term value creation plan by also entering the German market, the largest labour market in Europe, and providing it with significant scale in the large and exciting corporate health and wellness category”.
“Our journey with Exercite began with the ambition to create a leader in corporate fitness and digital health services. The company has not only achieved this goal, but has also expanded its reach across Europe through strategic acquisitions. Joining an international group marks a new chapter of growth and innovation for Exercite”, said Dr. Gregor Hengst, Managing Partner of Waterland. “Together with Waterland and our ambitious management team, we have succeeded in taking Hansefit and the Exercite Group to the next level while maintaining our strong commitment to our customers and partners. I would like to thank everyone who has been involved over the past years”, concludes Jens Pracht, founder of Hansefit.
Alberto Perfumo, founder and CEO of Eudaimon, emphasised the importance of communication in the welfare sector, adding: “By combining our experience and expertise in social welfare and people’s wellbeing with Epassi’s technological leadership and experience in benefits, we will be able to offer complete solutions to companies and their employees and become a leader in corporate welfare in Europe. Since the beginning of our adventure together, we have found with our partners a complete harmony of values and business practices: these are the values that have guided Eudaimon for more than 20 years since its foundation and that will continue to guide us”.
Terms of the transactions were not disclosed. The Exercite transaction is subject to customary closing conditions. Goodwin, Kirkland & Ellis and Paul Weiss advised TA and Warburg Pincus on the acquisition of Epassi and the combination with Exercite.