Northgate Public Services

Activity
Software outsourcing and IT services
Acquired
22 December 2014
Sector
TMT

Business
Northgate Public Services (‘NPS'), is a leading provider of software, outsourcing and IT services to local government and public sector organisations.

The company was acquired by Cinven from Northgate Information Solutions.

Founded in 1969, NPS employs more than 1,500 people in the UK across 10 offices and more than 750 people internationally including in its software development centre in Mumbai.

NPS, which is headquartered in Hertfordshire, provides software and related services to UK public sector markets including Local Government, Government Agencies, Public Safety, Housing and Healthcare. Its software and services are used by over 400 UK local authorities, all UK police forces, social housing providers in the UK and internationally, and NHS hospitals. Its IT projects support the sharing of information for criminal intelligence and investigations across UK police forces and the management of health screening records in the UK and in Ireland.

For the 12 months to 30 April 2014, NPS grew revenues by 7.2% and EBITDA by 6.9% to £181.0 million and £42.0 million respectively and has shown a sustained track-record of growth.

Rationale and strategy
Cinven's TMT team regards NPS as an attractive investment and the strategy for the company is to:

  • expand the local government product portfolio and cross-sell more (for example, payments and HR / Payroll) into its existing customer base;
  • consolidate existing market positions within UK housing, police and social care;
  • move into delivering a broader suite of solutions to primary and / or acute healthcare; and
  • broaden the international housing and healthcare footprint through acquisitions.

Cinven will work with management to drive growth through operational improvements in the core local business and focus on growth in public safety, healthcare and eligibility. 

NPS has invested in a modern, Software-as-a-Service (‘SaaS') eligibility platform which is applicable across the public sector in the UK and internationally. As a result, public sector organisations can migrate at low risk to flexible and modern IT solutions.

Already a market leader in the UK public sector, NPS has the potential to consolidate its position in attractive niches such as healthcare screening and the police and to expand internationally in markets including Canada, the US and Australia, where NPS already operates.

It is also well placed to benefit from the digitisation of public sector information, the need of government bodies to improve productivity and their desire to interact more effectively and directly with citizens.

NPS is the 10th investment from Cinven's Fifth Fund and follows several other investments in the TMT space including HEG, Visma and Ufinet.