Hg Capital to Acquire Software Provider Ideagen for £1.1bn

Despite other interested parties lurking about, Nottingham-based Ideagen confirms the news.

Software provider Ideagen has confirmed that its £1.1 billion takeover by private equity firm Hg Capital will go ahead.

As reported last month, other interested parties were lurking about. Astorg had showed an interest, while a third potential suitor, the private equity firm Cinven, walked away.

The acquisition of Ideagen will be made by Rainforest Bidco, a newly-incorporated wholly-owned subsidiary of funds managed by Hg. It’s not clear if there are any job cuts as part of the deal.

Ideagen explains that court and general meetings were held, and the relevant resolutions were considered and approved in relation to the acquisition.

Christopher Fielding, Joris Van Gool and Jean-Baptiste Brian, Partners at Hg, state: “Ben [Dorks, Ideagen CEO] and the team will now have greater flexibility to execute and accelerate longer term growth plans, including investments in product, technology, talent and large scale, accretive M&A.”

Hg is a software and services investor with more than 20 years of industry experience, including UK-based businesses such as IRIS Software Group and The Access Group.

Both Ideagen and Hg will probably be confident about the deal, as Hg has a portfolio of over 45 software and technology businesses, representing over 55,000 employees globally.

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Ideagen is based in Nottingham but is a global player. It has about 700 staff – and its operations are located throughout the UK, US, Australia, Europe, Middle East and South-East Asia. It provides quality, audit and risk software – and is used by about 8,000 customers across various industries such as aviation, financial services, life sciences, healthcare and manufacturing.

Notable Ideagen customers include Heineken, British Airways, Admiral, BAE, Aggreko, US Navy, Bank of New York and Johnson Matthey, as well as 250 hospitals across the UK and US.

There’s also good news for Hg as 88% of Ideagen’s revenues are recurring due to being subscription based.

Last month, house broker Shore Capital said Ideagen is expected to make a pre-tax profit of £23.2 million on an adjusted basis. That’s not a huge initial return for a purchase price of £1.1 billion, but Hg could be looking to the long-term opportunities.

In terms of Ideagen’s previous activities, it has been busy.

Back in December 2021, Ideagen raised £103.5 million to be used for product investment and more acquisitions.

Ideagen has also been acquisitive. Deals include London-based Mail Manager for £26.4 million; software validation and assurance company CompliancePath for £9 million; and Sydney-based regtech provider CompliSpace for AU$105 million (£57.7 million).

Antony Peyton
Antony Peyton
Antony Peyton is the Editor of eWeek UK. He has 18 years' journalism and writing experience. His career has taken him to China, Japan and the UK - covering tech, fintech and business. Follow on Twitter @TonyFintech.

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