A listed geospatial software solutions firm is set to be taken private in a private equity deal valued at £333 million.

The board at Cambridge-headquartered IQGeo has agreed a deal with KKR of 480 pence in cash per share, a 19% premium to its closing price of 405p.

The deal is 7x IQGeo’s revenue of £44.5m in financial year 2023 and 48x its adjusted EBITDA of £6.6m in the same period.

IQGeo is a global provider of software solutions such as maps, satellite imagery and GPS data to the telecommunications and utility industries. Its share price has increased more than 2.7x in the last two years.

KKR said it sees an opportunity to accelerate IQGeo’s transition towards a recurring software-centric business model under private ownership. 

“IQGeo’s sector is developing rapidly, as fibre and grid infrastructure are undergoing major transformation and upgrades to deliver against national connectivity and sustainability goals,” it stated.

“As a result of its recent growth… IQGeo is now approaching a potential inflection point.”

Accel unveils $650m fund to back ‘exceptional founders’

KKR says it has irrevocable undertakings and non-binding letters of intent to green-light the deal from shareholders holding 58.2% of shares in the business.

Should the deal go through, it plans to support IQGeo’s international expansion efforts and accelerate its inorganic growth strategy should the opportunity arise for strategic acquisitions.

Cambridge Startups 2.0 – nominate now!

“Having served on the IQGeo Board since February 2011, I am immensely proud of the strategic decisions and operational execution which has established IQGeo as one of the leading providers of geospatial software solutions to telecoms and utilities operators globally,” said Paul Taylor, chair of IQGeo. 

“Under the leadership of the current management team, IQGeo has delivered strong revenue growth and shareholder returns of over 9x over the last five years.

“KKR’s proposed offer underscores IQGeo’s highly successful cloud-based software and services, and represents an attractive valuation and an opportunity for shareholders to receive certainty through cash consideration, not only for value created in recent years but also the future platform value of IQGeo. 

“The proposed acquisition will provide IQGeo with the ownership structure and investment required to unlock its full potential.”

Rami Bibi, managing director and head of EMEA for KKR Global Impact, added: “In our view, IQGeo is unique in its support for continued global efforts addressing the digital divide and transforming grid infrastructure, which is aligned with KKR’s strong focus of investing behind grid electrification for net-zero goals. 

“To capitalise on the global growth potential ahead, increased investment and an acceleration of IQGeo’s strategy are imperative, and private ownership under KKR will help facilitate this.”

EMV Capital in deal for ‘Silicon Fen’ VC