Market Overview

VSS Exits Its Investment in IT-Ernity

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VSS, a private investment firm that invests in the information,
education, healthcare, and tech-enabled business services industries,
announced today it has exited its investment in IT-Ernity, a provider of
business-critical managed services and shared hosting for SMEs in the
Netherlands. The business was acquired by TransIP, a Dutch independent
hosting and VPS provider.

Founded in 2002, IT-Ernity offers a comprehensive catalogue of
standardized fully-managed solutions, including system administration,
protection, security, application management and other outsourced
services. The company provides shared hosting, domain registration and
secure infrastructure connectivity through xDSL and fiber.

Since 2008, the company has increased its scale through fourteen
acquisitions, including Proserve, a commercial internet service
provider, strengthening its existing customer base and service portfolio.

In May 2013, VSS made a growth capital investment in IT-Ernity alongside
GMT Communications Partners ("GMT"). Following the investment, IT-Ernity
completed the strategic acquisition of CloudVPS, a cloud
infrastructure (IaaS) provider in the Netherlands, and Signet, a
provider of connectivity, networking and VoIP services. Over the last
three years, IT-Ernity has increased its focus on the integration of the
acquired companies and on cross sell activities between labels,
transforming its strategy to an organic growth strategy. The company has
expanded its products and entered into agreements with leading brands.

"VSS was very supportive of our company's acquisition and organic growth
activities and was with us every step of the way, assisting in capital
structure, corporate infrastructure and strategy," said Chris de Jongh,
IT-Ernity CEO.

Patrick N.W. Turner, VSS Managing Director, added "IT-Ernity was poised
for growth at the time of our investment. Through our partnership with
the IT-Ernity's management team, and GMT, our U.K. based PE partner, we
achieved our shared vision of expanding IT-Ernity's products, services
and footprint. TransIP is the logical partner to take IT-Ernity to the
next level."

VSS has extensive experience investing in IT services sector, recently
investing in Coretelligent, a provider of comprehensive IT and private
cloud services, and QuadraNet, a full-service data center provider in
downtown Los Angeles, California – one of the most well-regarded
peering-exchanges locations.

VSS is in the process of investing its third Structured Capital fund
(VSS Structured Capital III). VSS Structured Capital I and II are ranked
as the top-rated funds by net IRR for the 2005 and 2009 vintages,
respectively, according to Preqin's listing of North American mezzanine
funds as of March 31, 2018. In addition, VSS Structured Capital II was
featured in the 2017 Preqin Alternative Assets Performance Monitor as a
"Top 10 Performing Mezzanine Fund for All Vintages."

About VSS

VSS (www.vss.com)
is a private investment firm that invests in the information, education,
healthcare, and tech-enabled business services industries. VSS provides
capital for growth financings, recapitalizations, strategic acquisitions
and buyouts to lower middle market companies and management teams with
the goal of building companies organically as well as through a focused
add-on acquisition program. VSS makes privately-negotiated investments
across the capital structure and has the ability to invest in situations
requiring control or non-control equity, mezzanine securities and
structured equity securities.

About IT-Ernity

IT-Ernity, founded in 2002, is a leading provider of business-critical
managed services and shared hosting for SMEs in the Netherlands. The
company offers a comprehensive catalogue of standardized fully-managed
solutions, including system administration, protection, security,
application management and other outsourced services. The company
provides shared hosting, domain registration and secure infrastructure
connectivity through xDSL and fiber and is based in Rotterdam.

Disclaimer: With respect to Preqin benchmark comparisons, VSS
utilizes both debt and equity in structuring its investments; not all
mezzanine funds incorporate warrants and/or equity components; further,
VSS SC I & II each made 2 (of 12) investments in European-based
portfolio companies.
No fund-level leverage has been utilized in
VSS SC I, SC II or SC III to achieve the results shown above.

Preqin Performance Rankings, as well as the "Top Performing Fund"
graphic were obtained directly from Preqin.com.
The information
obtained from Preqin has not been customized specifically for VSS.
All
of the Preqin sourced information and supporting data is available to
subscribers of Preqin.com.

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