Over the last few weeks investment in ERP software has been increasing. The latest rumour (Source:Reuters) is that Infor is the latest in a line of companies sold or resold. It seems like private equity firms believe that there is money to be made in ERP software. According to Allied market Research the global ERP software market is set to grow 7.2% each year until 2020 when it will reach $41.69 billion.
The last year has seen several deals commence that should complete before the end of 2016. In December 2016 EQT made a bid for IFS, the Swedish ERP software company. While the initial bid saw only 84% snapped up, a revised offer was recently agreed with the hold out investor. This should see IFS taken private within a matter of weeks. Oracle made a bid for NetSuite, valuing the company at $9.3 billion in July. That purchase has since been delayed with one investor, T Rowe Price group saying that the bid is not high enough. In July this year Apax partners sold Epicor to KKR in a deal said to be worth $3.3 billion (Source: Bloomberg).
Infor ready for next stage
Infor is currently owned by Golden Gate capital and Summit Partners. Golden Gate capital purchased Infor, then Agilsys in 2002 and Summit invested as recently as 2012. Under Golden Gate, Infor went on an acquisition trail, building up a long term debt of around $5.6 billion. Recently acquisitions include GT Nexus for $675 million and in the last year Predictix and Starmount. The company already included the remains of Baan, once market leader in ERP before SAP and Oracle took a stranglehold of the market. Infor remains the number three though.
It seems that there are some other private equity firms keen on getting a share of the growing market. Perhaps they see good returns to be made from investing now. Infor is probably at the perfect time for such investment as well. Although other avenues have not been ruled out, despite what Charles Phillips said during a recent analyst interview, an IPO is a possibility. Morgan Stanley are apparently working with Infor on recent approaches by interested parties. If that interest is sufficiently strong it is possible that Golden Gate and Summit will look to an IPO to get their return.
Read More@ http://www.enterprisetimes.co.uk/2016/09/19/is-infor-up-for-sale/
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