Hg appoints advisers for IRIS Software auction

Gustav Hoejmark-Jensen and Charlie Taylor-Kroll
06 July 2022

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IRIS Software majority owner Hg has appointed Goldman Sachs and Arma Partners to advise on an upcoming sale of the business, two sources familiar with the situation said.

Hg handed out the mandates in recent weeks, with Goldman Sachs taking the senior position and Arma mandated for a junior role, one of the sources said.

IRIS Software could be valued at around EUR 2bn (GBP 1.7bn) both sources said. The asset, which is one of Europe's largest software providers, is expected to be marketed off annual EBITDA in excess of GBP 110m (EUR 128m), as previously reported.

It remains unclear whether London-listed ICG, which has owned a minority stake in IRIS since 2018, will also look to exit, while Hg could also decide to retain control of the business, by transferring IRIS to a continuation fund or new vehicle, as reported.

In May 2018, Hg reinvested in the company alongside ICG via a fund-to-fund transaction, through which its stake was transferred to its Saturn vehicle from the Hg6 Fund. IRIS was valued at GBP 1.3bn at the time of the transaction, which was then the UK's largest-ever privEUR ate equity-led software buyout, according to a press release.

Since Hg and ICG's takeover of IRIS in 2018, the company has executed 13 bolt-on acquisitions, seven of which were completed last year, according to Mergermarket coverage. IRIS most recently acquired Paycheck Plus, as reported in May.

Founded in 1978 and headquartered in the UK, IRIS provides business software and services to companies in the accountancy, education and business markets. The firm is one of the UK's largest private software companies, according to its website.

IRIS, Hg, ICG and Arma Partners declined to comment. Goldman Sachs did not respond to requests for comment.