Secondary buyout of NCC

Barclays has backed the €44 million secondary buyout of The NCC Group from ECI and the current management team. The independent technology assurance company supplies software escrow, independent third party protection and storage of business critical software.

In 1999 ECI led the £6 million buyout the National Computing Centre’s commercial activities to form the NCC Group. The not-for-profit centre was set up in the sixties but was forced to become more commercially orientated during the nineties. The current buyout is being led by the management team of the escrow division, headed by managing director Rob Cotton.

Barclays will take a 65 per cent stake in the company, which is based in Manchester and London, and employs around 140 staff. Barclays Leveraged Finance provided debt finance. Tony Hyams, who led the deal for Barclays, said: “Already a proven industry leader, The NCC G`roup has strong continuing potential, particularly in an economic climate where companies have higher business risks thus necessitating stronger support systems.”

As well as being the UK market leader in the escrow deposit of computer source code, NCC also provides IT consultancy, largely to public sector customers. It will continue to offer this service, predominantly in the protection, verification and assurance markets. In the year to the end of May 2002 the company’s turnover increased by 7 per cent to £11 million and profit before tax increased by 51 per cent £1.72 million. Sales for this year are around €19 million. The potential value of the market for escrow services in the UK is thought to be around €150 million.