Mid-market private equity firm August Equity has made another foray into the software and services market with the acquisition of 4Projects, a UK software provider for the construction industry, for an undisclosed sum.
4Projects allows clients to share documents, blueprints and plans online, to facilitate large building projects. It uses a “software as a service” model, hosting software online which clients pay to use, rather than buying it as a standalone product.
The company’s client base covers the private and public sectors, and includes Microsoft, Fujitsu, E.on and the Ministry of Justice. Its software was used in the construction of Arsenal Football Club’s Emirates Stadium, which opened last year.
4Projects, which currently employs about 50 people in the UK, has enjoyed double-digit revenue growth since its inception in 2001, according to August investment director Fraser Davidson.
With the backing of August, it will now be able to grow beyond its existing client base in the UK construction market, he said: “The business might look to enter international markets, either directly or indirectly, and also attack some new verticals.” Davidson said August was looking at “two or three sectors” where the firm’s document sharing service may also prove useful, such as estate management.
August has brought in Stephen Edwards to chair the business as part of the buyout. Edwards, who will replace departing chairman Paul Callaghan, has extensive experience in the small business software area, making his name at US firms Dun and Bradstreet, Sybase and Unisys. He has been involved with private equity since 2001, and also chairs LDC investment BigHand.
The buyout firm’s previous experience helped them win the deal in an auction process run by corporate finance boutique Regent Associates. Until February this year, August owned a business called RedSky IT, another application software provider that was formerly part of UK-listed IT group Misys.
Its current portfolio also includes Planit Holdings, a UK firm that develops software and services for computer-aided manufacturing and design. August bought the business for £41 million (€61 million; $83 million) last year, its first public to private transaction.
This is August’s second investment this year, following the deal announced last month for healthcare provider Lifeways Community Care.