News
Cavendish advises on the sale of Link Group Consultants Ltd
11 December 2006Cavendish Corporate Finance Limited (''Cavendish'') is pleased to announce that it acted as adviser to the shareholders of Chester based Link Group Consultants Limited (''Link'') on the sale of the company to UK techMARK™100 listed company Northgate Information Solutions plc (Code: NIS), for an undisclosed sum.
Link, which trades under the name Link HR Systems, develops and markets specialised reward software focusing on pay and grading solutions for use by HR professionals in major organisations around the globe. Link has recently been ranked 7th in the North and 40th overall in the Deloitte Technology UK and Ireland Fast 50 Awards for 2006.
The Company has developed four related products to assist HR professionals simplify and streamline their reward processes:
- Link Evaluate™
Job evaluation module - Equal Pay Reviewer™Enables organisations to test their pay structures for any pay discrimination
- Pay Modeller™a dedicated tool for the development and costing of pay structures
- Link Market Pricer™a module designed to ensure that organisations remain competitive and continue to attract and retain the best available talent
Link first licensed the Job Evaluation software in 1990, with Pay Modeller developed in 1991. By the mid 1990s Link had been selected by HM Treasury, Ministry of Agriculture, Cabinet Office and Ministry of Defence among others to assist in the development of their internal pay structures. It now has over 1,000 client installations across four continents and is regarded as a world leader in pay structuring.
Their most important client is the UK National Health Service, the largest employer in Europe. In 2004 they were awarded a five year contract where they supplied a hosted solution to the NHS for them to evaluate all of the jobs in the NHS. So far over 450,000 jobs have been evaluated. Other notable users of the software include Wyeth, Astra Zeneca, Accenture and the Government of South Africa and the City of Seattle.
The founder of Link, Andrew Thompson, approached Cavendish following a recommendation from fellow M&A International Inc. member Avantus Corporate Finance of Sweden (facilitated by a friendship Lars Ericsson has with one of Link's senior team).
Following a competitive pitch process, which included presenting a list of purchasers drawn from research by a number of M&A International partner firms, Cavendish was appointed to advise on a trade sale of the business which would allow the founder an exit on completion.
Cavendish approached a number of HR software providers, human resource businesses, major recruitment companies, as well as several businesses in related sectors. Interest was shown by a number of US buyers and WebEx demonstrations were given to those parties. In the end the strategic fit and ability to deliver the right deal for shareholders was tabled by Northgate Information Solutions plc, a UK quoted group with sales of £333 million last year and a market capitalisation of £450 million. From initial expression of interest to completion was less than 3 months. The revenue multiple achieved was around 2.5 times trailing year sales.
Andrew Thomson commented on the work done by Cavendish lead director [Raymond Fagan] and executive Edward Lethbridge: ''It has been a privilege to work with you both and I will not forget your professionalism, knowledge and dedication that helped us achieve the right end result.
I hope our paths cross again in the future. I will of course heartily recommend your services to others who find themselves in need of an exit strategy in the future.''
[Raymond Fagan] added: ''We delivered to the shareholders a transaction that met all of the key objectives. Northgate will benefit enormously from the skill, dedication and knowledge of the Link people and the excellent clients relationships.''
Cavendish contacts for further information:
[Raymond Fagan], Director
Edward Lethbridge, Executive