Listed group in £2m swoop for EdTech ARC Technology


Listed group Software Circle has acquired EdTech ARC Technology.

The serial acquirer of software companies has completed a £2 million cash deal for ARC, a provider of software solutions for the management of practice-based learning to higher education institutions across the UK and the Republic of Ireland.

The initial consideration is £1.1m, with deferred consideration of £300,000 to be paid on the first anniversary of completion. Up to a further £600,000 is payable contingent upon the achievement of certain targets relating to the future financial performance of ARC, based in Byfleet, Surrey.

ARC’s solutions offer academic institutions a powerful, fully-integrated administrative software suite, allowing students, tutors and departmental staff to become empowered users of academic and institutional information.

The core platform enables university placement teams to centrally administer student placements, providing information about practice environments in which students undertake practice-based learning.

ARC has high client retention rates and in excess of 90% of revenues arise from annual recurring fees from its clients.

Nader Bishay, managing director and 50% shareholder of ARC, will remain with the business, entering into a new employment contract and will continue to lead the team of eight staff. Founding shareholder Soraia Bishay will leave the business.

ARC reported revenue of £1.1m, EBIT of £340,000 and closing net assets of £940,000 for the year ended 31st July 2023.

“We’re delighted to announce our first acquisition since raising additional funds in September 2023 to further our aim of becoming a serial acquirer of vertical market software businesses,” said Gavin Cockerill, CEO of Software Circle plc.

“ARC meets our acquisition criteria extremely well and adds to Software Circle’s growing family of niche vertical market SaaS companies that generate revenues of a recurring nature. We welcome Nader and his team to the Group and look forward to working with them to drive further growth in the years ahead.”

Bishay commented: “Having founded ARC in 1990, I am keen to remain part of the business. I was attracted by Software Circle’s operating model which allows ARC’s operations to continue and flourish in an independent decentralised way, supporting us where we need. I look forward to continuing to grow the business and taking it to the next level under Software Circle’s ownership.”

Software Circle plc added that it is “currently in exclusive discussions with three acquisition targets with a collective turnover of approximately £4.1m and an adjusted EBITDA of £1.4m”.

ARC’s shareholders were advised by Temple Bright LLP, led by corporate partner Alex Pyatt.

This article appeared on on 22 February 2024.

Alex Pyatt
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