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26th May 2009
CAT.193
CATAPULT COMPLETES INVESTMENT IN SYSTEMS INTEGRATION
Lichfield-based Systems Integration (Trading) Limited has raised £850k to fund a concerted sales drive of its application software products marketed into the meat processing industry in both the UK and Northern American marketplaces.
Catapult Venture Managers has invested £250k from the AEIF Fund which it manages, alongside funding from the management team, private investors and the bank. This is Catapult’s second investment this year following on from seven transactions in the West Midlands in 2008.
In addition, Catapult has introduced two individuals: Phil Kelly as Chairman and Sant Mehta. Their introduction to an already strong management team should help accelerate the company’s growth.
Phil has in-depth experience of software service businesses and is currently a Non-Executive Director at Sandersons; whilst former 3i executive Sant is a successful entrepreneur, whose interests include spearheading a large fruit processing business.
Phil said: ‘’The business is well positioned for sales expansion based on recent product developments and pressure from the market for improved efficiency and better cost and margin management.’’
Commenting on Systems Integration’s future development plans, Chief Executive Rob Stephens said: ’’We have developed a range of innovative products that help our customers solve some very complex problems. The investment will aid getting these products into the market place and significantly widen our customer base.’’
Graham Mold, Director with Catapult commented: “This is a profitable business set-up by Rob Stephens in 1992. The company generates its income from three sources: new contracts, bolt-on services/upgrades for existing customers, and maintenance revenue.
“To date, SI has enjoyed organic growth of its UK business base and now has the financial backing to initiate a concerted sales push both into the domestic market and North America.
“The meat industry is relatively low tech and under pressure from both rising costs and low margins. Therefore, SI’s software – designed to improve profitability by ensuring meat is weighed and cut precisely – will help the sector maximise the profit on each animal. Small increments in margin make a big difference,” he said.
There is considerable potential for SI’s software in the United States, as the country starts to ‘catch-up’ in terms of the strict regulation that is in place in the UK.
Three factors currently impact on the market and should help increase demand for SI software. The first is legislation, partly driven by outbreaks of BSE, for example. This has led to the need for strict traceability. Graham Mold adds: “This aspect is already stringent in the UK and starting to become so in the USA.
“Secondly, retailers prefer delivered packaged meat products at fixed weights rather than ‘in-house’ butchery and, thirdly, margins are very low and under even more pressure with increasing transportation costs,” he concluded.
George Green LLP, the Black Country based law firm, advised Catapult on its investment. Philip Round, an associate in George Green’s corporate team, said: “In a difficult economic climate, it is encouraging to see that investments in growing businesses continue to be made. I have enjoyed working with Catapult to help it to achieve its investment objectives, and it is good to be a part of Systems Integration’s success story.”
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For further information contact Graham Mold at Catapult Venture Managers on 0121 616 0180 or 07768 148187 or Paul Shrimpton at PSPR Ltd on 0121 354 7311 or 07979 505322.
Note to editors:
Catapult Venture Managers Ltd is a leading private equity fund manager with one of the largest investment teams in the Midlands operating from offices in Birmingham and Leicester. With £80m in Funds under its management Catapult seek equity investment opportunities from £200k to £2m for growing businesses. Contact details for Catapult are 0121 616 0180 (Birmingham), 0116 238 8200 (Leicester) or catapult@catapult-vm.co.uk Catapult Venture Managers Ltd is Authorised and Regulated by the Financial Services Authority. The Advantage Enterprise and Innovation Fund (AEIF) is funded by Advantage West Midlands and the European Regional Development Fund.
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