LDC books 2x on financial technology business

The in-house private equity arm of Lloyds Banking Group has sold Avelo for £210m to Australian software firm IRESS, returning more than 2x.

Lloyds Development Capital (LDC) has sold Avelo, a supplier of sourcing systems to the UK financial services industry, to IRESS, an Australian software company for £210 million (243 million, $322 million).  

The sale has generated a return of more than 2x, according to a statement. 

LDC acquired a majority stake in the business in August 2009 for £42 million. The firm backed the management team of Avelo, which was then still called 1st – The exchange, as part of a £115 million transaction. 

Under LDC’s ownership, Avelo has extended its products and services reach and has grown through organic investments and bolt-on acquisitions. 

In 2010, LDC provided follow on capital for Avelo’s acquisition of N4 Solutions, a software provider for the financial services industry, which increased the business distribution capabilities. A year later, LDC supported the add-on acquisition of Screen Business, a website design company. Last year, LDC backed further expansion with Avelo’s acquisition of TrigoldCrystal, a UK technology supplier for mortgage distributors. 

“We have focused on supporting Avelo’s buy-and-build strategy, which has succeeded in growing the business and significantly improving its technology, software and consultancy solutions,” Daniel Sasaki, managing director of LDC’s London investment team, said in the statement. 

In May, LDC sold Eve Trakway, a vehicle and pedestrian equipment maker, netting the firm a 2.5x return. In April, LDC acquired a 69 percent stake in restaurant group D&D London for £50 million.