Northgate Information Solutions has been acquired by private equity group Kohlberg Kravis Roberts at an enterprise valuation of £1.1 billion and de-listed from the London Stock Exchange. The company expects to expand its public sector programme through organic growth and strategic acquisitions.
Referring specifically to its social housing customers, Dave Meaden, managing director of public services, Northgate, said, “Northgate is committed to developing innovative ways of working to support our housing clients in delivering more effective and efficient services to their residents. The company is expanding into strategic areas of public service delivery, including performance partnerships and organisational re-engineering, and is committed to further strengthening the business to deliver excellence through innovation. This provides housing organisations with additional opportunities to develop excellent services that meet the changing needs of their residents.”
When the deal was announced, the investment banking group Numis commented, “This announcement will be positive for other local government software companies (Civica, Anite, IBS), because this deal opens up the possibility of consolidation in this sector, led by private equity. Both Civica and IBS are valued at just half the multiple that KKR is paying for Northgate (albeit that the HR parts of Northgate are presumably the most highly valued by KKR).”
Northgate has also recently announced a partnership with Serengeti Systems to deliver a sustainable planning system to help housing associations and local authorities meet the potential challenges of climate change.
Werner Neudecker, managing director, Serengeti Systems, said, “Planning departments have a pivotal role in helping to create sustainable communities. Our partnership is committed to supporting innovation and providing practical hands-on assistance and advice to our planning partners.”
Joe Bradley, managing director for local government and social housing, Northgate Public Services, added, “We are increasingly seeing RSLs play a wider role in their local areas, for example through the provision of employment training. That this role is strengthened is key to sustainable communities. Yet for social housing to fully meet the needs of tenants and the community we need to see a significant shift, particularly in relation to participation. I believe that an ambitious change programme is required involving housing providers, a proactive regulator, government and other stakeholders.”