Volume licensing transaction engine SoftwareOne has sold a minority stake to private equity investor KKR for an undisclosed sum, the companies confirmed today.
Challenges facing the Microsoft enterprise reseller – AKA a Licensing Solution Partner – are multiple, not least the proliferation of the cloud as more businesses consume software as a service.
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The continued erosion of fees that vendors cough for selling classic on-premise software also adds to the hurdles that companies like SoftwareOne are facing; only recently Microsoft confirmed almost one half of its compensation pot is set aside for cloudy services.
Clearly KKR can see some upside in its investment, taking on a 25 per cent stake as existing shareholders and the management team keep hold of the remaining operation.
Surely the thinking is if SoftwareOne can build a cloud operation, values will only go up.
“The software industry is changing, and together with KKR, we see a unique opportunity to capitalise on those changes and continue to increase the value we bring to our customers, in particular in the areas of cloud and value added services,” said SoftwareOne CEO Patrick Winter in a PR blurb.
Privately-owned SoftwareOne claimed to sell licenses, software asset management, tech consulting and cloud services to more than 25,000 punters in 115 countries globally. It resells IBM, Oracle, VMware, SAP and a “further” 9,000 publishers.
The firm, headquartered in Switzerland, employs 2,500 heads. It turned over $4bn in sales during 2014, the company claimed on its website, up 40 per cent in the last ten years.
Jean-Piere Saad, director of KKR’s private equity technology team in Europe, said: “Proliferation of software applications, growth in cloud adoption and increasing complexity of enterprise IT environments is the new reality within corporate IT departments.”
He added it is going to provide SoftwareOne with “growth capital for further organic expansion and M&A”.
One possible target for those of a more ambitious disposition at SoftwareOne and KKR is Microsoft LSP Comparex, which came onto the market some months back, with parent Raiffeisen Bank under some pressure to cash in on the business. ®