Northgate encounters acquisition proposals
Unsolicited offers include multimillion-pound offer from private equity firm
VAR Northgate Information Solutions confirmed last week that it has received several acquisition offers.
Northgate told CRN that the unsolicited offers, which are believed to include a multimillion-pound offer from private equity firm General Atlantic Partners, have already resulted in movement of its share price. According to the stock market last week, 7.5 million Northgate shares changed hands.
Northgate’s business has two divisions: a human resources arm and public services arm. Dave Meadan, managing director of Northgate public services, told CRN: “We have received a number of unsolicited offers from companies. Northgate is investigating these and they may or may not lead to the company being acquired.”
Elaine Axby, principal analyst at Quocirca, told CRN that Northgate could consider selling off just one arm of its company.
“There’s a huge amount of opportunity created by Northgate in the local-government market,” she said. “So it wouldn’t surprise me if larger companies with similar backgrounds, which often find it difficult to break into the local-government sector, don’t try to acquire Northgate in an attempt to secure business there.”
The announcement follows a plethora of contracts that Northgate has recently won, including a three-year contract worth more than £1.1m with builders merchant Travis Perkins to support its computers, peripherals and communications equipment (CRN, 25 August).
In May, the VAR’s managed services division also signed a three-year £750,000 managed IT contract with utilities trade body Consumer Council for Water to provide it with fully managed IT across eight regional offices (CRN, 5 May).
>> Further reading: