Silverfleet buys MFS for £51m

Francesca Veronesi
30 May 2019

Tweet
Facebook
LinkedIn
Google plus
Send to

Silverfleet Capital has agreed to acquire a stake in UK-based Microgen Financial Systems (MFS) from Aptitude Software Group for ТЃ51m.

The acquisition of MFS will be executed by Silverfleet's dedicated lower-mid-market investment team. It will be the second investment from the Silverfleet European Development Fund, which is targeting €250m and is understood to be nearing a final close.

The transaction is subject to the approval of the shareholders of the seller, Aptitude Software Group.

The GP was understood to be competing with one other mid-cap private equity fund in the process.

Silverfleet's investment will enable MFS to expand its product range, client base and geographical reach, as well as executing acquisitions.

The GP is familiar with the trust and fiduciary services sector. Its investments in Ipes and TMF generated money multiple returns of 3.7x and 6.2x respectively, according to a statement.

Debt finance for the transaction was provided by Muzinich and Co's Pan-European Private Debt Fund.

Company
Headquartered in Fleet and with offices in London, Guernsey, Cambridge and Cyprus, MFS provides front and back office technology services to the financial services industry. The firm's client base comprises wealth and asset management firms, and trust and corporate services administrators. MFS was founded in 1974.

The company's key product in the trust and fund administration sector addresses the core operational and regulatory requirements of trust administrators, fiduciary companies, corporate services and fund administrators.

MFS generates its revenue through ongoing software licence fees, software maintenance fees and upfront implementation fees.

The business generated sales of £18m and adjusted operating profit of £7m in 2018.

People
Silverfleet Capital – David MacKenzie (partner).
MFS – Robert Browning (CEO).

Advisers
Equity – CIL (commercial due diligence); BDO (financial due diligence, tax); Eversheds Sutherland (legal, corporate finance); Intuitus (IT due diligence); AJ Gallagher (insurance due diligence); Spectrum Corporate Finance (corporate finance).
Vendor – Investec (corporate finance).