Press Release
A local entrepreneur, with a successful history of developing software companies, is swiftly building a small empire by acquiring established software businesses.
Ron Bienvenu, chief executive office of Greenwich-based HALO Technology Holdings, is set to make his largest acquisition since establishing the holding company last August.
HALO has entered into an agreement to acquire five software companies from Platinum Equity, a global acquisition firm based in Beverly Hills, Calif. The transaction is expected to close within 30 days, said Bienvenu.
Although specific financial terms were not disclosed, Platinum Equity will retain an equity position in HALO as part of the transaction, he said.
Bienvenu formed HALO when his Greenwich-based private investment firm, ISIS Capital Management, took a majority equity stake in WARP Technology Holdings. The intention was to use the publicly-traded firm as a platform to launch a holding company specializing in software technology acquisitions.
Bienvenu, who has developed and sold two of his own software businesses, felt the time was right to invest in the industry, which historically has not created a lot of wealth, he said.
“I think the software industry as a whole has changed a lot. People don’t understand that and don’t accept that. And that’s created opportunity,” he said.
HALO acquires only profitable companies that have an established customer base, he said. “The idea is to help them grow in a healthy, profitable manner.”
This latest acquisition is HALO’s third and puts five diverse software makers in its growing portfolio.
“It will more than double the size of HALO on a revenue basis; it will increase our cash flow more than double,” Bienvenu said. “I think it will put us at a position where we will start to get some attention.”
The businesses being acquired by HALO are Tesseract and David Corp., both of San Francisco; Boston-based Process Software; New Hampshire-based ProfitKey International and Atlanta-based Foresight Software Inc.
“They are trying to pull together a collection of companies that have a profitable operation or close to profitable and lend their management expertise to eke out every last bit of profitability,” said Tony Rizzo, director of M&A research the 451 Group, a Manhattan-based market research firm.
Technology mergers and acquisitions are “extraordinarily hot.” Rizzo said. “They are happening at a rampant rate – faster than we’ve seen since we started to track it in January 2002.”
“It’s been an enormously busy year,” Rizzo said. “Every month, we see record-setting numbers.”
In 2004 M&A deals averaged 35 a week. So far this year, there is an average of 50 a week, he said.
“As far as total number of deals, we are seeing enterprise software lead by a hefty margin,” he said.