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Acquisition of Kypera Holdings

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Software and managed services provider, Castleton Technology, has expanded its operation with the acquisition of housing management and finance software provider Kypera Holdings.

Castleton, which has offices in Driffield, has been aided in its expansion with a £2m investment from the Business Growth Fund.  At the same time, the group's existing investor MXC Capital has invested £1.5m while Barclays has extended it bank facilities by a further £1m.

AIM-listed Castleton provides tailor-made software and infrastructure solutions, predominately in the social housing sector. Nearly a third of all the social housing associations in the UK are now Castleton customers.

The deal complements Castleton's long-term growth into the social housing sector, which has seen it acquire six other businesses during the past two years - Montal, Documotive, Keylogic, Opus, Impact and Brixx .

The acquisition of Milton Keynes-based Kypera will provide a software platform to Castleton's multiple service lines intended to create the only integrated, single Enterprise Resource Planning platform solution in the social housing sector. It also brings an international presence to Castleton's operation.

The investment has been made by BGF Quoted, BGF's specialist team focused on listed businesses. Previous investments in AIM-listed companies include Kidderminster-based carpet manufacturer Victoria and Styles & Wood, headquartered in Greater Manchester.

Ian Smith, chief executive of Castleton said: "This is a critical acquisition for us. Kypera adds a whole new level to Castleton's offer. We are now the only integrated, single ERP platform solution able to meet every aspect of our customers' needs - the only "one stop shop" serving the sector.

"We are pleased to have BGF Quoted on board as a strategic long-term partner, whose funding will allow us to unlock further growth in the business."

Castleton, which also has operations in Wolverhampton and Driffield, East Yorkshire, said the group now supplied products and services to more than 500 social housing organisations across the UK, Ireland, Australia, New Zealand and the Netherlands.

Gurinder Sunner, BGF, said: "Castleton's management team has demonstrated its ability to execute an acquisitive and organic growth strategy. We are delighted to be supporting them as they strengthen their offering even further."

The investment was led by Gurinder Sunner, Paul Brindley and Tom Jenkins for BGF Quoted.

Jonathan Simms, partner in the corporate practice at Leeds-based law firm Clarion, and associate Rachael Stockley advised Kypera, with Phil Bailey and Christ Wright of Armstrong Watson in Leeds providing corporate finance advice to the vendors. 

Source: The Business Desk