i capital aquires 30% of MIP Holdings
i capital, the niche financial services company, has acquired
30% of Rivonia-based software development house MIP Holdings
for an undisclosed injection of cash. The transaction has
been done through i capital's private equity fund, the i
capital Growth Fund I. MIP will use the investment to accelerate
its growth, says chairman Richard Firth.
"Our company has grown consistently over the last nine
years, but we have reached the point where we need to grow
to the next level. i capital's investment and value-added
involvement in our group allows us to do this."
Immediate
steps to be taken by MIP include investment in R&D to
produce object-oriented and Internet-enabled versions of
its software applications, a broadening of its scope beyond
its current vertical industry focus, and the development
of international distribution channels for its products.
"Many companies have sought to invest in MIP,"
says Firth, "but i capital have brought more than just
a cash injection. They have become actively involved in
our business and assist with strategic, financial and organisational
input. The investment model we have put together ensures
i capital shares in both risk and reward. This investment
will allow us to extend our portfolio of products and provide
customers with further value-added services, to accelerate
our global plans, attract and retain the right staff, and
ultimately create value for all stakeholders."
i
capital director Rowan Williams says his company was attracted
to MIP because of its entrepreneurial nature, its focus
and the depth of management. "Richard and his team
have built a service-oriented niche IT player that has enormous
upside potential. With this investment they can accelerate
their development and over the next three years build a
significant company before taking MIP to market with strong
fundamentals in place." i capital director Rowan Williams
join the board of MIP. The companies have similar value
systems, Firth emphasises, and complementary competencies.
"i capital has the market experience to be able to
discern what works and what doesn't. Both parties will work
very hard for this partnership to fulfil its potential."
i capital, 25%-owned by Liberty Life, is a niche financial
services company which invests in small to medium-sized
intellectual capital companies to help accelerate their
growth. "In looking for companies in which to invest,
we target companies with experienced management teams that
are established with a profitable trading record and a well
defined industry focus. In addition we invest in businesses
with a realistic purchase price and exit potential and there
is the ability for us to add significant value," says
Williams. "MIP meets all these criteria."
MIP
Holdings is an IT specialist company that focuses on systems
development and implementation related to contribution management
and claims facilitation. It has focused to date on the healthcare
administration, property administration and pension fund
administration industries. Its clients include Insurance
and Finance Marketing (IFM), International Retail Fashion
Focus, Link Pharmacies (in conjunction with ATIO Corporation),
City Properties and Medical Services Organisation. It has
developed its own rapid application development toolset,
the Astra range, and recently expanded into Europe through
the opening of a UK office and the appointment of Danish-based
Hansen IT Consulting to distribute its Astra software throughout
Europe.
Liberty Life takes stake in i capital
6 September 1999 Press release
Liberty
Life has acquired a 25% in i capital, an unlisted niche
financial services company that focuses on mid-sized deals
involving private equity fund management and corporate finance
advisory services.
The
company was founded by four entrepreneurs with extensive
corporate finance and private equity experience, David Smollan,
Lance Williams and Rowan Williams.
Liberty's
Senior General Manager: Finance, Mark Bloom, says the i
capital transaction is consistent with the spirit of deal-making
in the private equity industry and reflects a shift in the
way Liberty will conduct business in the future. i capital
has differentiated its approach in the private equity and
corporate finance fields by focusing on businesses and transactions
that bigger players tend to downplay or ignore.
i
capital provides a full range of corporate finance services
to its selected target market. i capital is concentrating
on the smaller to medium sized companies that have traditionally
been underserviced from a corporate finance perspective
by the large banks. i capital has established an open ended
private equity fund that invests growth capital in owner
managed businesses with an experienced and successful management
team, that have a clear market focus and exciting prospects.
To-date i capital has secured a number of opportunities
based on this approach that entails adding value to portfolio
companies by taking an active interest in the operations
of the business. The deal benefits both parties.
i capital will remain independent of Liberty Life and Liberty
will gain exposure to the fast growing private equity industry.
"We
are excited about Liberty's interest in our business and
will be able to draw from the business knowledge of two
of their directors who sit on our Board," says Rowan
Williams, Director, i capital.
For
further information please contact : Mark Bloom Senior General
Manager: Finance Liberty Life Telephone 011 408 3810 or
Rowan Williams Director i capital Telephone 011 784 2230.
i
capital Growth Fund I acquires 25% of Marketel (Pty) Ltd
i
capital Growth Fund I, the private equity fund managed and
controlled by i capital (Pty) Ltd, has acquired 25% of Marketel,
a Sandton based specialized telecommunications and media
aggregator.
In
November 2000, the i capital Growth Fund I acquired a 25%
interest in the company to further strengthen the company
and to provide for future growth and investment opportunities.
i capital is a niche financial services company which focuses
on private equity and corporate finance. i capital, through
its private equity fund, provides growth capital to service
orientated information technology and telecommunications
companies and currently has four investments. Craig Lyons,
a director of i capital says, "We identified Marketel
as a leader in the mobile information services sector and
decided to approach them. The significant growth capital
provided to Marketel will be used to develop additional
integrated voice and data services to meet the needs of
both the local and international mobile and fixed line markets."
Marketel
operates in the mobile information service provider ("ISP")
industry. ISP's act as infomediaries in making available
information from content providers via various access platforms
to consumers. Robin Meyer and Hayden Schwarz, both of which
have a number of years of experience in the industry, lead
the company. Craig Lyons joins the board to provide strategic
guidance and the appropriate financial skills required for
this high growth technology company. "Many companies
have sought to invest in Marketel", says Robin Meyer,
"but i capital have brought more than just a cash injection.
They have become actively involved in our business and give
strategic, financial and organisational input.
The
investment model we have put together ensures i capital
shares in both risk and reward. This investment will allow
us to extend our portfolio of products and services to provide
customers with further value-added services, accelerate
our global plans, attract and retain the right staff and
ultimately create value for all stakeholders." Craig
Lyons says i capital was attracted to Marketel because of
its entrepreneurial nature, its focus and the depth of its
management. "Robin and his team have built a service-oriented
niche telecommunications and media player that has enormous
upside potential. With this investment they will be able
to increase the number of information and media services
offered to consumers and provide access to the information
via a number of access methods including wireless application
protocol ("WAP") and short message service ("SMS")".
Strategic
alliances are key to Marketel's success and an alliance
with Vodacom has resulted in Marketel being appointed as
an official Information Service Provider. Current services
offered by Marketel include: Up to the minute news and information
service through Newsbreak - 082 152; Horse racing information
lines - 082 1711/1718; A number of information and competition
lines; Bambanani - competition line relating to SABC license
holders - 082 284 8484; Generations - competition line through
SABC - 082 284 7777; Surfers information line; and Services
for companies looking to provide information to its customers
and staff.
Tighter
regulations bring good news to SA business
Business Report October 18 2000
Having deals blocked by regulators is a new feature on the
mergers and acquisitions (M&A) landscape, yet it is
commonplace in more developed financial jurisdictions. This
is possibly a reason why many international banks are reporting
a busy 2000, whereas their domestic counterparts are largely
having a lean year.
When
finance minister Trevor Manuel blocked the merger of Goldfields
and Franco Nevada for foreign exchange reasons rather then
competitive issues, the decision was lambasted by many analysts
as capricious and seriously harmful to South Africa's image
as an investment destination.
The
decision comes on top of a rash of new regulations in the
past few years governing the corporate environment including
competition legislation, taxation, insider trading legislation,
changes to the listing rules of the JSE to the Companies
Act. And more is set to come.
But
Lance Williams, a director of i capital advisers, a niche
corporate advisory business, says it is all part of a new
regulatory environment that corporate finance teams have
to learn to live with.
"While
regulation should not be so overly restrictive as to impede
the efficiency of a healthy M&A environment, there are
potential benefits improved regulation can bring,"
says Williams.
The
entrance of the bulge bracket large international investment
banks has raised the standard of investment banking advice
provided to South African corporates. They are accustomed
to operating and providing advice on transactions in the
sort of regulatory environment in which South African banks
are only now coming to terms with.
"As
a result a likely benefit of a more robust South African
regulatory environment is the elevation of the standard
of advice that South African advisers, be they lawyers,
accountants or investment bankers, provide to local companies
engaging in M&A activity," says Williams.
Competing
with other developing countries for investment capital and
skills is a function of becoming an integral part of the
global economy.
"We
have no choice but to have a regulatory environment which
conforms to global standards to enable our capital markets
to be competitive," he says.
A
blemish on South Africa's credibility in international markets
has been the recent spate of spectacular corporate failures,
such as LeisureNet, Macmed, Beige and New Republic Bank.
"How
many of these corporate failures could have been avoided,
or been less spectacular, with an improved regulatory environment,"
asks Williams.
The
new listing rules governing companies listed on the JSE
will go a long way to improve the level of protection for
shareholders of a listed company.
Many
of the new JSE listing rules will result in improved disclosure,
allowing potential investors to make better informed decisions.
The
principles on which the new JSE listing requirements have
been based are international best practice; greater disclosure;
the changing corporate environment and the promotion of
international investor confidence. Some of the more important
amendments to the JSE listing rules include requiring listed
companies to disclose company share dealings by directors;
declaration of compliance with GAAP; a minimum profit history
of R8 million before tax to qualify for a main board listing;
encouragement to comply with the King Code of Corporate
Governance; requirement to state reasons for non-compliance
and the prohibition on listing new pyramid companies and
low voting 'N' shares.
"One
cumulative effect of an enhanced regulatory environment
will be to advance good corporate governance among listed
and unlisted companies alike. This will lead to increased
transparency in corporate South Africa to the benefit of
all stakeholders.
"Participants
in the M&A market should therefore see not only the
potential barriers, but the benefits which this change brings
to corporate South Africa," says Williams.
Legislation
depresses buoyancy in the market
Business Report, Wednesday June 14, 2000
The
level of merger and acquisition activity in South Africa
is standing up well in the face of a number of factors which
are tending to depress the buoyancy in the market.
South
Africa has experienced a string of amendments to the regulatory
landscape in which merger and acquisition activity occurs.
Important amendments were made to the Companies Act, introducing
several new concepts, such as share buybacks and disclosure
of nominees. In addition, the introduction of new competition
legislation has had a wide reaching effect on potential
mergers and acquisitions.
Lance
Williams, a director of i capital advisers, a niche corporate
adviser, says:" Another factor is the increasing complexity
of the regulatory environment surrounding mergers and acquisitions.
"This, coupled with weak capital markets and many companies'
increasing circumspection when in entering into takeovers
has seen a decline in both the value and the volume of transactions."
As a result, participants, including potential acquirers
and professional advisers, now face a significantly more
complex and challenging environment," says Williams.
