Capita acquires Trustmarque for £57m

The FTSE 100 firm said the technology business delivers integrated services that support UK private and public sector organisations through each step of their IT investment process.

Trustmarque’s core business is software resale, licensing and technology services, Capita’s board said, with its “enterprise-as-a-service” model helping customers transform, integrate and simplify their technology and management of services.

It serves more than 1,450 private and public sector clients and has 620 employees in five offices in York, Coventry, Sheffield, Edinburgh and London.

Trustmarque reported revenue of £191.9m, net revenue of £107m, underlying EBITDA of £7.3m and underlying operating profit of £4.3m in the financial year to 31 December 2015.

Gross assets were reported as £80m at the time.

The acquisition is expected to achieve Capita’s target post-tax return on investment of 15% in 2018.

“This acquisition provides Capita with a set of capabilities and expertise that complement our existing businesses – and the mix of core reseller activity and higher value services is a strong proposition that will sit well with our wider technology offering,” said Capita chief executive Andy Parker.

“Trustmarque’s ‘enterprise-as-a-service’ model will provide a number of opportunities to build new services and deepen our existing relationships with key partners, in particular with Microsoft.”

Parker said the acquisition will particularly enhance the growing Capita Technology Solutions business, expanding its ability to offer services to current and potential clients.

“Specific specialities, such as software asset management and strategic cloud consultancy, have strong synergies with Capita’s existing propositions,” he explained.

Trustmarque chief executive Scott Haddow said the business is thrilled to join Capita and take the next steps forward in its development.

“We are now well positioned for strong organic growth, supported by Capita’s impressive expertise, experience and scale.

“There are a number of opportunities for integration – including our success selling services through G-Cloud – that will help us to lower costs and cross sell services to customers,” he said.

Haddow explained that Capita’s long history with Trustmarque means the two businesses already understand each other well.