Nature of Business

Civica is a market leader in specialist systems and business process services for the public sector, applying software, managed services and outsourcing to help organisations achieve a successful and more cost-efficient way of working. The Group works with more than 2,000 organisations internationally in local government, education, social housing, healthcare and enforcement, as well as other regulated markets such as pensions, utilities and legal. With a 25-year history of supplying software and services in the UK, Australia, New Zealand, Singapore and the USA, Civica’s products and services are behind local transactions with 25 million citizens and businesses, processing over £45 billion of income and expenditure.

Investment Overview

3i and funds managed by 3i acquired a majority holding in Civica in April 2008 in a public-to-private transaction that valued the business at £218m. The business stood out as the premium operator in its field due to its leadership domestically, its superb platform for international growth and its experienced executive team led by CEO Simon Downing. Since our investment organic growth has been driven by a combination of sustained software sales from Civica's market-leading product portfolio and the roll-out of cloud based solutions in all markets. Growth has been further driven by up-selling services to existing customers including specialist outsourcing such as an IPR-led BPO proposition. For example Civica recently won a 10 year £35m contract with Luton Borough Council to deliver outsourced ICT services to the council. Civica has been and will continue to grow through gaining greater market share.

We have also supported Civica’s acquisition-led growth and since our investment in April 2008 the company has made a total of 11 bolt-on acquisitions in Australia, New Zealand and the UK. Recent examples include IBS OpenRevenues. PSCAL and RM Asia Pacific which have reinforced its leading position in the revenue and benefits sector and widened its health and education offerings. Reflecting the strong financial performance in 2011 we further strengthened Civica’s funding power with new and increased debt and equity funding for future acquisitions.

_{Regulatory notice: This transaction involved a recommendation of 3i Investments plc}