LDC has completed an investment to take a significant minority stake in a transaction to support the continued growth of SAP HANA services business, Centiq Group
Established in 1998 and headquartered in Nottingham, Centiq is a leading IT services and software provider, specialising in the design, configuration and implementation of SAP HANA, SAP’s rapidly growing in-memory platform. The business also offers its proprietary software, Monitiq, to manage and monitor customers’ IT infrastructures.
The deal was transacted by LDC’s Nottingham team of Andy Grove and James Robinson, with support from Matt Newbold. Andy Grove and James Robinson will both join the board with immediate effect.
Chief Executive Richard Hall led the Technology and Commercial Due Diligence team from CloudOrigin alongside Senior Adviser, Zena Meyer. “This deal was a fantastic opportunity to deliver our integrated IT insight, with technology landscape research into the rapidly evolving SAP HANA market and commercial due diligence of Centiq’s broad customer base to paint a complete picture of the opportunity for our client LDC”. CloudOrigin recently advised LDC on their backing for the management buyout of global insurance solutions and service provider SSP.
Centiq has experienced strong growth in recent years, having carved out a niche position in the SAP HANA market, building a first mover advantage during the early stages of HANA adoption which has enabled the business to build an impressive blue-chip customer base. Monitiq, which provides infrastructure monitoring and management primarily around infrastructure optimisation and capacity planning, has been developed based on Centiq’s unrivalled HANA implementation track record and experience and has been successfully sold to 100% of the business’ HANA clients to date.
The business will continue to be led by CEO and founder, Glyn Heath, alongside Sales Director, Gareth Pritchard, and a highly experienced senior management team. LDC’s investment strategy will be to partner with this high calibre team to deliver continued growth with new and existing customers and via new channels.
Centiq is well-positioned to capitalise on a range of future expansion opportunities, with an emphasis on supporting an increasing rate of SAP HANA implementations whilst driving further growth in its Monitiq offering to a broader customer base. The deployment of development capital will help accelerate this growth with a focus on investment in its commercial and technical functions, and developing more proprietary IP to enhance its core offering.
As part of LDC’s investment strategy, the management team will be further supported by the appointment of Colin Garrett and Rob Jones, who join the board as Non-Executive Chairman and Finance Director respectively. Both individuals bring a wealth of knowledge and experience to the business and have worked with LDC’s Midlands-team in the past.
Andy Grove, Director and Head of LDC’s Nottingham office commented: “Centiq is a highly-impressive business that is well placed to capitalise on future growth opportunities. It has carved out a niche position within the IT services sector as a specialist in the SAP HANA space, which in turn lends itself well to driving new business growth with blue-chip corporates.
“We look forward to partnering with Centiq’s ambitious management team as they look to build further on recent successes with HANA deployment, as well as their market leading software offering, Monitiq.”
Glyn Heath, Chief Executive of Centiq Group said: “SAP’s HANA transforms the ways in which organisations can exploit the value in their growing, complex data, and this represents a substantial area of growth for Centiq.
“This is an exciting time for our business and LDC’s investment brings additional strategic support and financial backing that will help to increase the pace of our ambitious growth plans. We look forward to the future with increased confidence that we can capitalise on the large, expanding market opportunity.”
LDC completed the transaction with support from a number of Midlands-based advisors, including Gateley, who acted as legal advisor to LDC. Centiq’s management team was advised by Eversheds and Cooper Parry. PwC’s Nottingham-based team conducted financial due diligence.
The deal with Centiq represents LDC’s 13th new investment of 2015, having invested circa £300million of new funding, and forms part of LDC’s on-going strategy to invest in leading regional mid-market businesses, backing high calibre management teams. LDC recently announced plans to invest £1.2billion of equity into Britain’s mid-market businesses over the next three years.