March 2, 2005
Network optimization vendor Actix Ltd. has sold a majority stake in its business to private equity firm Summit Partners, a deal anticipated by Unstrung earlier this week (see Actix Linked to Sale).
Summit will invest £40.6 million (US$77.6 million) for “a majority ownership stake” in the London-headquartered company. According to a statement, “management shareholders of Actix will continue to hold a sizeable minority stake in the business.”
Actix isn’t revealing specifics. “We can’t give details, but existing shareholders will still have significant skin in the game,” says Peter Jones, strategy and marketing director.
Jones states that today’s announcement marks the first “institutional investment” in the company’s 14-year history.
Founded in 1991, the company has built up an impressive list of customer names for its network optimization software, including the likes of Orange SA (London/Paris: OGE), T-Mobile International AG, Verizon Wireless, and Vodafone Group plc (NYSE: VOD). Company literature boasts that “8 of the world’s top 10 operators use Actix,” with its services “deployed by 90% of 3G operators.” (See Vodafone Ireland Deploys Actix, Actix Assists Euro 3G, and H3 Austria Deploys Actix.)
In its financial year 2003 (ended January 31, 2004), Actix reported a 35 percent increase in pre-tax profits to £2.15 million (US$4.13 million) from £1.6 million ($3.08 million) in 2002, while 2003 sales grew 25 percent to £15.3 million ($29.4 million) from £12.2 million ($23.5 million) in 2002. At the year-end, cash balances stood at £2.8 million ($5.38 million).
“We’ve been profitable for the last four or five years,” notes Jones. “Actix has been a very fast growing and successful business, and the board felt that to help us get to the next stage it would be really beneficial to have someone like Summit involved in the business, especially one that has a track record of seeing companies grow from that difficult stage of tens of millions in revenue to the next stage of hundreds of millions.”
The company is also mulling a potential acquisition growth path. “We will continue with the business plan but feel that with Summit’s help going forward a number of strategic options will open up. We believe there may be opportunities to grow substantially via acquisition or other types of strategic opportunities.”
— Justin Springham, Senior Editor, Europe, Unstrung
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