IRIS Software owner Hg plots post-summer sale

The buyout fund is expected to launch a formal auction process as early as September for the software specialist, although no final decision has yet been made on the exact timing of the process, the sources said.  

The auction, which is being managed by Arma Partners and Rothschild & Co, is expected to go wide to a range of prospective bidders including US-based financial sponsors, the sources said. 

IRIS Software is expected to be pitched to prospective buyers off FY23 EBITDA in the region of GBP 130m, according to one of the sources. 

IRIS Software has made a slate of acquisitions under Hg's ownership, mostly recently acquiring Apex HCM for an undisclosed fee in February and myPay Solutions, an online payroll processing specialist from Thomson Reuters in October, both for undisclosed fees. 

IRIS has a score of 70, according to Mergermarket's Likely to Exit (LTE) predictive algorithm.*  

It is unclear whether ICG, which has owned a minority stake in IRIS since May 2018, will also look to exit, one of the sources said. The sponsor acquired a stake when Hg reinvested in the company via a fund-to-fund transaction, through which its stake was transferred to its Saturn vehicle from the Hg6 Fund. 

Founded in 1978, IRIS provides business software and services to companies in the accountancy, education and business markets. The company is the fourth largest software group in Europe, according to Hg's website.

Representatives for Hg, IRIS, Arma and Rothschild declined to comment. ICG did not respond to a request for comment. 

*Mergermarket's LTE predictive analytics assign a score to sponsor-backed companies to help track and predict when an exit could occur through M&A, an IPO, a direct listing or a deSPAC transaction. 

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