Four funds managed by North East-based NVM Private Equity have received cash proceeds totalling £40.92m after the realisation of investments in a software solutions firm.
NVM is one of the UK’s leading independent private equity businesses, making investments between £2m and £10m into a range of growing, diverse companies, including several within the region such as Cleveland Biotech, Kitwave and Wear Inns.
In March 2010 NVM, which is headquartered in Newcastle, invested £9m into the management buy-out of Kerridge Commercial Systems (KCS), which specialises in business management solutions for the distributive sector.
Having enjoyed a successful period of growth over the last five years with the support of NVM Private Equity (NVM), Berkshire-based KCS has now partnered with Accel-KKR to support the existing management team and their continuing strategy. The move represents an exit for the four NVM-managed funds.
Ian Bendelow, chief executive of KCS, said: “Over the last five years we have grown from some 130 people to 330 people, significantly invested in our products and customer service, expanded our capabilities and capacity and added even more value to our growing number of customers. NVM have been supportive of the management team’s strategy. Going forward we now look to accelerate that strategy and chose Accel-KKR to help us expand further.”
Martin Green, managing director of NVM, said: “Ian and the team’s outlook has always been long-term – investing in the people and infrastructure to position KCS for continued growth and increased market share.
“Its products are highly innovative and intuitive, ensuring a solid and loyal customer base.
“The investment by Accel-KKR will enable the business to expand on the growth it has already achieved from existing and new customers; and enter into new vertical markets and geographies.
“It has been a pleasure working with Ian and the team over the years, and we wish them the best of success for the future.”
The four funds overseen by NVM each published stock market notes, announcing the realisation of investments in KCS.
Northern Investors Company PLC has received cash proceeds of £16.38m for its holding of ordinary shares and loan notes in KCS, Northern 3 VCT PLC has received £7.37m, Northern 2 VCT PLC has received £8.58m and Northern Venture Trust has received £8.59m.
The London Stock Exchange portfolio updates detailed how the uplift in the funds’ net assets resulting from the realisations totalled £3.82m.
Each fund may also become entitled to receive further cash proceeds in February 2016, subject to any warranty claims which may be made by the purchaser, which will be recognised in the financial statements as and when they are received.
According to the Northern Investors Company PLC policy of realising its investment portfolio and returning funds to shareholders, the directors now intend to make a further distribution of no less than £18.5m to its shareholders, by way of a tender offer.
A circular giving details of the tender offer will be published on February 27 and the repurchase and cancellation of shares will be completed by March 31