Private equity group backs MBO of software firm

NorthEdge Capital has backed the MBO of Solihull-based Phoebus Software (PSL), marking the second investment from its SME Fund.

PSL delivers software and services that enhance the account servicing processes across a range of products, including residential and commercial mortgages, equity release, bridge loans, asset finance and savings.

The company has a strong client portfolio of multinational financial services firms across the building society, banking and loan servicing sectors. Clients include Atom Bank, One Savings Bank and Pure Retirement. The business was founded in 1989 as a subsidiary of Heritable Bank before becoming fully independent in 1997, and currently employs 130 staff.

NorthEdge’s investment backs existing CEO Paul Hunt in this primary MBO and will enable Hunt and his team to spearhead additional investment of resource and capital into PSL’s product offering.

“After sustained growth and success over many years, our business is ready to move to the next level,” said Paul Hunt, CEO at PSL. “In working with NorthEdge, we have an investment partner who will provide backing to ensure that our products and services continue to be at the forefront of market requirements.”

Andy McEwan, formerly of Oracle and IFE Services, will join the business as Non-Executive Chairman. 

The investment was led by NorthEdge’s Rob Freer, Head of Midlands, and Investment Director, George Potts, with Potts joining the board.

This is the second investment since the close of NorthEdge’s £120m SME Fund in July last year. The Fund targets businesses across all industry sectors in the Midlands and North of England, investing £2m-£10m of equity in management buy-outs, equity release, growth and development capital and buy-and-build opportunities.

The investment was completed with corporate finance advice from Cooper Parry and legal advice from Mills & Reeve.

Financial and Commercial Due Diligence was completed by RSM and CIL respectively.