| Background |
| Stuart Farr and Bruce Mennell, founders and principal owners of Beauchamp Financial Technology, Ltd. (BFT), leveraged their backgrounds – Stuart with experience in designing and implementing middle office applications, Bruce as a developer and systems architect — to create Beauchamp Financial Technology, Ltd. (BFT). A few years later, they obtained financing from Goldman Sachs and Soros Funds Limited. By 2005, BFT had become the leading provider of trading and portfolio management software for alternative investment managers. The Company had 120 employees at offices in London (Headquarters), Dublin, New York, Boston, Hong Kong, Kuala Lumpur and Riga, Latvia. They served over 170 clients in six countries in Europe, North America and Asia. At that point, the company had crossed into clear profitability, and was growing fast. But, the hedge fund software market was becoming increasingly competitive and the thought of raising the additional capital needed to take BFT to the next stage held little appeal for them. Together with Goldman and Soros, they agreed that that the company should seek a strategic partner that could help take the company to the next level. They engaged M&A to provide strategic and financial advice. |
| Overiew of Transaction |
- On November 29, 2005, BFT was acquired by Linedata Services, a provider software and services to the global financial services marketplace for asset management, leasing & credit, and savings and insurance companies. At the time of the transaction, Linedata Services, a Paris based public company (PA: LIN), had a $300 million market capitalization.
- The purchase price consisted of a total of up to £25 million (US$44 million), consisting of an initial cash payment of £11 million ($19.25 million) and incentive (earn-out) payments of up to an additional £14 million (US$24.5 million) over the next 2 fiscal years. The purchase price represented approximately 3 times Beauchamp's trailing revenue and approximately 70 times trailing EBITDA.
- The BFT / Linedata combination is expected to allow the BFT team to offer an enhanced suite of products to its customers, while at the same time, putting Linedata in a stronger position to offer full front-office to back-office portfolio management software capabilities for the full spectrum of asset managers and hedge funds. The transaction also provided significant liquidity to the founders and their financial backers.
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| M&A Role |
- M&A was the exclusive strategic and financial advisor to Beauchamp Financial Technology, Ltd.
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Press Release | Case Study |
