Private equity sells up: Mincom bought again

Renai LeMay
Monday, 09 May 2011 17:29

IT Industry - Deals

In a statement released this afternoon, Swiss power and automation technology group ABB, which maintains an enterprise software business dubbed Ventyx, announced it would acquire Brisbane-based Mincom for an undisclosed sum, subject to regulatory approvals.

It is standard practice for large private equity firms to buy into companies which they believe show the potential for strong growth if the right management team, company structure or backing capital was put in place; typically the financial giants will then attempt to turn the company around in a relatively short period of time, before realising gains from their investment through a commercial transaction such as an industry sale or - for example, in the case of Australian retail giant Myer - through a public listing.

Since it was acquired by Francisco Partners back in 2007, Mincom, which focuses on software for resources companies, has gone through a substantial internal restructure.

The company's then-chief executive, Richard Mathews, said at the time of acquisition that there would be no change in either headcount or Mincom's management team. However, since that time the company has gone through several rounds of redundancies, as well as putting in place new management.

In April 2009, for instance, the company lost about 100 staff globally, with 50 of those being from its Australian base, and although the company said there were no plans to shift its head office to the US, communication with the media was conducted from its US office.