Ideagen has reported a 12th consecutive year of growth as it looks ahead to a £1.1 billion takeover.
The Nottingham RegTech, which raised an almost £100 million M&A war chest late last year, said strategic acquisitions saw it grow revenue 41% to £92.2m in the year ended 30th April, with adjusted EBITDA up 33% to approximately £30.5m.
A huge 86% of those revenues – £78.9m – are recurring on an annual basis with customers.
London-listed Ideagen’s software helps companies comply with regulation and manage risk. It serves more than 8,000 customers, including Heineken, British Airways, the US Navy, the Bank of New York and the European Central Bank.
It counts seven of the UK’s top 10 accounting firms, three quarters of the world’s biggest pharmaceutical companies and all of the world’s top aerospace and defence companies among its client base.
Ideagen boss’s journey from bootstrapping to £1.1bn takeover
Its impressive figures have attracted a flurry of takeover interest, with several suitors coming forward in April. Ideagen reaffirmed in its financial report that it is recommending to shareholders an all-cash offer from London-based private equity firm Hg Pooled Management, which values the company at £1.09bn.
It also reaffirmed that a counter bid from French rival Astorg – with which Ideagen is continuing to hold talks – could arrive. London-based private equity firm Cinven pulled out last week.
“I am pleased to report another strong year for Ideagen, delivering strong organic growth and customer momentum,” said CEO Ben Dorks. “We have completed seven acquisitions that significantly extend our leadership in compliance software for regulated industries and expect to derive synergy opportunities once integrated.
“Our primary focus remains growing our recurring revenues and expanding our customer base. The offer received from Hg reflects the quality, track record and future growth potential of Ideagen.
“Given the momentum in the group, we remain confident about the year ahead.”
Speaking to BusinessCloud before the takeover approaches, Dorks told BusinessCloud: “I expect us to continue our twin focus strategy of organic growth and making acquisitions
“We raised £100m just before Christmas so we have a balance sheet that supports us in further acquisitions this year. And I’ll be very disappointed if we’ve not grown the business substantially during the next 12 months.
“We’re quite public about our vision: we want to be a £200 million ARR business by 2025 and therefore the businesses we acquire are very clear on what their part of that looks like. And that’s a really important part of our purpose and vision.”