i capital, the niche financial services company, has acquired 30% of Rivonia-based software development house MIP Holdings for an undisclosed injection of cash. The transaction has been done through i capital`s private equity fund, the i capital Growth Fund I. MIP will use the investment to accelerate its growth, says chairman Richard Firth.
"Our company has grown consistently over the last nine years, but we have reached the point where we need to grow to the next level. i capital`s investment and value-added involvement in our group allows us to do this." Immediate steps to be taken by MIP include investment in R&D to produce object-oriented and Internet-enabled versions of its software applications, a broadening of its scope beyond its current vertical industry focus, and the development of international distribution channels for its products.
"Many companies have sought to invest in MIP," says Firth, "but i capital have brought more than just a cash injection. They have become actively involved in our business and assist with strategic, financial and organisational input. The investment model we have put together ensures i capital shares in both risk and reward. This investment will allow us to extend our portfolio of products and provide customers with further value-added services, to accelerate our global plans, attract and retain the right staff, and ultimately create value for all stakeholders."
i capital director Craig Lyons says his company was attracted to MIP because of its entrepreneurial nature, its focus and the depth of management. "Richard and his team have built a service-oriented niche IT player that has enormous upside potential. With this investment they can accelerate their development and over the next three years build a significant company before taking MIP to market with strong fundamentals in place."
Lyons and fellow i capital director Rowan Williams join the board of MIP. The companies have similar value systems, Firth emphasises, and complementary competencies. "i capital has the market experience to be able to discern what works and what doesn`t. Both parties will work very hard for this partnership to fulfil its potential."
i capital, 25%-owned by Liberty Life, is a niche financial services company which invests in small to medium-sized intellectual capital companies to help accelerate their growth.
"In looking for companies in which to invest, we target companies with experienced management teams that are established with a profitable trading record and a well defined industry focus. In addition we invest in businesses with a realistic purchase price and exit potential and there is the ability for us to add significant value," says Lyons. "MIP meets all these criteria."
MIP Holdings is an IT specialist company that focuses on systems development and implementation related to contribution management and claims facilitation. It has focused to date on the healthcare administration, property administration and pension fund administration industries. Its clients include Insurance and Finance Marketing (IFM), International Retail Fashion Focus, Link Pharmacies (in conjunction with ATIO Corporation), City Properties and Medical Services Organisation. It has developed its own rapid application development toolset, the Astra range, and recently expanded into Europe through the opening of a UK office and the appointment of Danish-based Hansen IT Consulting to distribute its Astra software throughout Europe.
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