28th March 2013. Melbourne-based Micorosft Sharepoint value added solutions provider Nintex has announced it has received an offer for the business from two leading US private equity firms, TA Associates, a leading global growth private equity firm, and Updata Partners, a leading technology-focused growth equity firm. This follows an investment by Macquarie Capital in October 2010 and continued growth in the US market.
The Wall Street Journal has reported sighting the offer documents and that:
- The consortium’s offer values the unlisted Melbourne-based company at US$222m, and carries the recommendation of Nintex Group’s board.
- Nintex’s fiscal 2012 revenue was A$55.8 million, while its profit before income tax was A$14.2 million.
- The offer statement includes a letter from the chariman Mr Brian Cook stating the offer implies an EBITDA multiple of 14*2012 EBITDA.
- Macquarie Groups October 2010 investment gave them a 25.6% stake, with co-founders Brian Cook and Brett Campbell holding 32.7% each.
- the above three shareholders, totalling 91% of the shareholder base intend to accept the offer.
- TA and Updata intend to fund the deal with senior and subordinated debt, as well as equity.
- Nintex shareholders have been offered either A$1.8445 per share they own, or stock in the new company, plus unsecured notes. The notes are being used as deferred cash consideration and will have a four-year maturity.
Allens is serving as legal counsel and Spurrier Capital Partners and Macquarie Capital are providing advisory services to Nintex. The sale is particularly timely, given Macquarie’s financial year ends at the end of this month.
Gilbert + Tobin and Goodwin Procter are providing legal counsel and KPMG is providing accounting advisory services to TA Associates, and Proskauer Rose is serving as legal counsel to Updata Partners.
“TA Associates and Updata Partners will enable Nintex to accelerate its growth, further expand internationally, and offer its customers and partners new and exciting innovative products,” said Brian Cook, Co-founder and Group CEO of the Nintex Group.
“We chose TA and Updata for their extensive experience and proven track record helping established software companies become standout market leaders,” said Brett Campbell, Co-founder and Global VP of Alliances of Nintex.
“Nintex is an attractive investment for a number of reasons, including strong organic growth and momentum, a successful global partner distribution network, exceptional customer satisfaction and a deep management team,” said Harry Taylor, a director at TA.
Taylor will join the Nintex board alongside Edward Sippel, Asia Pacific managing principal at TA, and Kurt Jaggers, a managing director at the PE firm. John Burton and Jon Seeber will represent Updata on the board.
“We have been aware of Nintex for several years, watching the company continuously outperform and establish a leadership position in workflow solutions on the Microsoft SharePoint platform,” said John Burton, a General Partner at Updata Partners.
This is TA’s second technology-related investment in Australia. Last September, the private equity firm bought Hong Kong-based network and satellite communications service provider SpeedCast, and then in December completed the bolt-on acquisition of Adelaide-based Australian Satellite Communications (ASC).
About Nintex Group Pty Ltd.
Nintex was started in Melbourne in 2004 by Brian Cook and Brett Campbell to develop products to take advantage of new developments in Microsoft technologies and strategies. The company reached $1 million revenue 16 months later and in 08-09 has revenue of $10 million, a growth rate of 278% over three years.
Nintex is the leader in workflow solutions Microsoft’s Sharepoint, with more than 4,000 customers in 90 countries serviced by a global network of high quality partners and service providers. Nintex delivers innovative software and cloud services that empower organizations to automate business processes quickly and easily. Nintex’s biggest market is the United States, followed by Germany, Britain and Japan.
In Australia, Nintex also trades under OBS for IT Services. Australia’s first Microsoft Gold Partner, OBS have over 140 staff that service Australia with offices in Sydney, Melbourne, Brisbane, Perth, Adelaide and Canberra.
About Updata Partners
Updata Partners is a leading technology-focused growth equity firm with nearly $500 million of capital under management. Updata invests in high-growth software, internet, and technology-enabled services companies with innovative intellectual property and market-leading solutions. Led by an investment team averaging more than 20 years of experience in the technology industry, Updata seeks investments where the combination of the firm’s financial backing and the operating expertise of their partners will accelerate growth. Updata is headquartered in Washington, DC. For more information, please visit www.updatapartners.com.
About TA Associates
Founded in 1968, TA Associates is one of the largest and most experienced global middle-market growth private equity firms. The firm has invested in more than 425 companies around the world and has raised $18 billion in capital. With offices in Boston, Menlo Park, London, Mumbai and Hong Kong, TA Associates leads buyouts and minority recapitalizations of profitable growth companies in the technology, financial services, business services, healthcare and consumer industries. More information about TA Associates can be found at www.ta.com.