US-based private equity firm Bain Capital has made its largest purchase in Australia to date with the acquisition of business management software firm, MYOB.
Bain purchased the software company from Archer Capital and HarbourVest Partnersfor a reported $1.3 billion, giving it a majority stake. The move may come as a blow to Newcastle, UK-based enterprise software firm Sage, who was reportedly in the works to buy MYOB for $1.4 billion, but bailed after recent stock market turmoil slashed Sage’s share price.
“It has been the leader in the financial software space for SMEs in Australasia for a very long time with a strong proposition on customer's needs," said Walid Sarkis, a managing director at Bain. “The growth potential in this market is strong, with a growing trend of entrepreneurs starting up their own businesses,” he said.
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MYOB CEO Tim Reed said, “We are entering the era of the connected business and are focused on the growth opportunities in front of us, particularly given the strong period of innovation MYOB is enjoying as it moves its business online.”
“Bain Capital is an ideal partner to take us forward given its proven successes in leading similar companies to higher ground in other parts of the world. Its internationally recognised portfolio group of local management consultants and ex-operations professionals with proven track record can no doubt provide the expertise to take us through our next phase of growth,” Tim Reed added.
MYOB’s software has been deployed in over one million small and medium businesses in Australia and New Zealand. Bain Capital currently has a portfolio of 12 companies in China, Japan and India and has been involved in the Australian market for 15 years with investments in Frucor, Startronics and Vertex.