Saratoga Takes on More Telecom –

Saratoga Partners recently acquired Aptis, a provider of telecommunications billing and customer care software and services with operations in Texas and New York, from Platinum Equity.

Chris Oberbeck, a managing director at New York-based Saratoga, declined to provide a transaction price, but said the company generated revenue in excess of $20 million in 2000.

Upon completion of the deal, Saratoga will split Aptis into two entities, placing the Texas operations, which will maintain the Aptis name, under EUR Systems, an ASP for the telecom industry that Saratoga acquired last year (Buyouts June 19, 2000, p. 12). The New York operations of Aptis will function as an independent company now called Commsoft, based out of Albany, N.Y.

The Texas part of Aptis is basically an add-on acquisition for EUR Systems, Oberbeck said. As an affiliate of EUR, Aptis will have access to substantial resources and increased visibility in the marketplace. Together, Aptis and EUR will have more than $60 million in revenue.

Saratoga Partners likes this particular area of telecommunications because of its recurring revenue and wide variety of customers, Oberbeck said.

As for Commsoft, Saratoga has re-recruited the company’s two founders Larry Davis and James Jackson to be chief executive officer and chief operations officer, respectively. They founded the company in 1985, but left when Commsoft was sold to Billings Concepts Corp. in 1999, before it was sold to Platinum Equity last year.

“They (Davis and Jackson) will bring the company back to where it was – make it a thriving, independent software sales and service company for telecommunications,” Oberbeck said.

Commsoft will offer software development, sales and support, and customized services to the local, long distance, ISP and wireless communications sectors. It specializes in computer telephony integration, including Internet-based packet switching and cellular telephone applications.

The two parts of Aptis were merged by publicly traded Billings Concepts and then sold to Platinum Equity along with other Billings Concepts assets last year. Oberbeck said the Platinum owners kept them together in hopes of having a suite of long distance and local communications capabilities – Commsoft’s expertise is in the CLEC area and Aptis focuses on long distance – but the two companies did not fit together culturally. They were focused on a different customer base and had a different kind of approach to the market, he added.

For these reasons, Saratoga decided to re-split the companies.

Saratoga Partners was founded in 1984 as a division of Dillon Read & Co., but spun off from the firm in 1998 after Swiss Bank Corp. acquired Dillon Read in 1998. Saratoga is investing Saratoga Partners IV LP, which closed on $250 million in 1999 (Buyouts Sept. 27, 1999, p. 8).