News that Northgate IS have finally been taken over (and delisted) by private equity behemoths KKR should be welcomed.
Too all intents, it seems the £1.1billion payment is providing expansion opportunities. Normally PE bods tend to buy companies with stable revenues and 'squeeze' the last pips of cost out of the business model particularly in more toughened times (as debt costs go up) so it will be interesting to see how Northgate HR shapes up having swallowed ARINSO last year.
Though Northgate IS posted good profits a report in the Financial Times in December provided a more cautionary note with some analysts taking a decidedly negative view on the company at that time with its debt levels - one even going so far in implying a potential breach of debt covenant.
This was sternly rebuffed by NIS and I trust that the KKR purchase will have ensured this is the case. And anyhow NIS won't have to put up with 'those pesky analysts' (in a Scooby Doo kind of way!) anymore since they are delisting.
My only concern is that there has been a lot going on in NIS in the past three years and I hope they get a chance to bed down, so to speak.
My best wishes on their journey.......
