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Transactions

November 2005
London, England
has been acquired by
Paris, France


Background

Stuart Farr and Bruce Mennell, founders and principal owners of Beauchamp Financial Technology, Ltd. (BFT), leveraged their backgrounds – Stuart with experience in designing and implementing middle office applications, Bruce as a developer and systems architect — to create Beauchamp Financial Technology, Ltd. (BFT). A few years later, they obtained financing from Goldman Sachs and Soros Funds Limited. By 2005, BFT had become the leading provider of trading and portfolio management software for alternative investment managers. The Company had 120 employees at offices in London (Headquarters), Dublin, New York, Boston, Hong Kong, Kuala Lumpur and Riga, Latvia. They served over 170 clients in six countries in Europe, North America and Asia. At that point, the company had crossed into clear profitability, and was growing fast. But, the hedge fund software market was becoming increasingly competitive and the thought of raising the additional capital needed to take BFT to the next stage held little appeal for them. Together with Goldman and Soros, they agreed that that the company should seek a strategic partner that could help take the company to the next level. They engaged M&A to provide strategic and financial advice.



Overview

On November 29, 2005, BFT was acquired by Linedata Services, a provider software and services to the global financial services marketplace for asset management, leasing & credit, and savings and insurance companies. At the time of the transaction, Linedata Services, a Paris based public company (PA: LIN), had a $300 million market capitalization.

The purchase price consisted of a total of up to £25 million (US$44 million), consisting of an initial cash payment of £11 million ($19.25 million) and incentive (earn-out) payments of up to an additional £14 million (US$24.5 million) over the next 2 fiscal years. The purchase price represented approximately 3 times Beauchamp's trailing revenue and approximately 70 times trailing EBITDA.

The BFT / Linedata combination is expected to allow the BFT team to offer an enhanced suite of products to its customers, while at the same time, putting Linedata in a stronger position to offer full front-office to back-office portfolio management software capabilities for the full spectrum of asset managers and hedge funds. The transaction also provided significant liquidity to the founders and their financial backers.

M&A Role

M&A was the exclusive strategic and financial advisor to Beauchamp Financial Technology, Ltd.

Press

Acquisition of Beauchamp Financial Technology

November 29, 2005

ACQUISITION OF BEAUCHAMP FINANCIAL TECHNOLOGY

Major extension of Linedata’s offering for hedge funds, today’s most buoyant segment in Asset Management

Paris, 29 November 2005 - Linedata Services is pleased to announce an agreement to acquire 100% of the stock of UK company, Beauchamp Financial Technology, Ltd. ("BFT"), which specializes in portfolio management software solutions tailored to the hedge funds segment of the Asset Management market.

The acquisition of BFT exemplifies Linedata Services’ strategy of further strengthening its position as a market-leading provider of technology to the world’s key financial communities through an exhaustive offering targeted at all types of Asset Management vehicles, including UCITS, institutional funds, and hedge funds.

A young company in full bloom and renowned for the quality of its solutions
Founded in 1997, BFT’s expertise and software solutions are today held up as a reference on the hedge funds market, notably thanks to the performance of its flagship middle- and back-office application, “FundManager”.

Positioned in a highly buoyant market (over 10,000 hedge funds listed worldwide saw their assets under management climb 30% in 2004), BFT has enjoyed spectacular growth from the outset and is expected to realize sales of over GBP 11 million (an organic growth rate of 25%) and EBITDA of 10% in the financial year ending 31st March 2006.

Based in London, New York and Hong Kong, BFT also set up a technical support platform in Riga, Latvia. Today, over 170 client firms in Europe, North America and Asia use BFT’s solutions, whether by local installation or ASP.

With a 110-strong team of sales, development and support professionals around the world, BFT distributes its products both directly and via white label partners including Fund Administrators and Prime Brokers.

A highly complementary acquisition to cement future growth
In acquiring BFT, Linedata Services has strategically reinforced its offering in a strong growth market by adding middle- and back-office solutions to its product portfolio. These significantly complement its front-office solution, LongView Trading, which is currently distributed to hedge funds via ASP within the framework of a partnership. As such, Linedata Services is now ideally placed to fully exploit its strong growth potential on this market segment, particularly when it comes to cross-selling.

In addition, BFT’s strong market position amongst hedge funds in Asia means that the acquisition should also boost Linedata Services’ development in that region.

Anvaraly Jiva, Chairman and CEO of Linedata Services said, “After the recent acquisition of US company GIS, this new acquisition in the field of asset management is perfectly in line with our objectives to increase our share of the world’s English-speaking markets, strengthen our position in the most buoyant segments, and to build a group of high-performing companies that can actively contribute to our future growth and adhere to our corporate mission statement”.

Stuart Farr, Chairman and CEO of BFT added “We are delighted to become a part of a group with an ambitious growth strategy and an offering that is highly complementary to our own. Linedata Services’ leading market position, its well-established, global reach and the quality of its solutions are all sound levers in securing additional share in a hedge fund market with unrivalled potential”.

A cash transaction with an immediate accretive effect
The acquisition is financed entirely in cash with an initial payment of GBP 11 million and an earn out clause for a maximum of an additional GBP 14 million, based on the economic performance ( growth and profitability) of BFT and spread over financial years 2005-2006 and 2006-2007. The operation will have an immediate accretive effect on the Group’s net EPS.

About Linedata Services
Linedata Services is a major international provider of financial IT solutions that specializes in Asset Management, Savings and Insurance and Leasing and Credit Finance. As a software and services provider and solutions integrator, Linedata Services offers global solutions that are tailored to the world of finance. The company is listed on the Paris Bourse - Eurolist segment B. For further information: www.linedata.com.

About Beauchamp Financial Technology
Founded in 1997, Beauchamp financial Technology (BFT) builds, markets and supports trading and portfolio management software products for alternative investment managers. Its flagship product, FundManager, has been installed with over 200 client firms and helps manage more than US$60 billion of assets under management. BFT operates from offices in London, New York, Hong Kong and Riga, Latvia. For further information, visit www.btfl.com.

About Marlin & Associates
Marlin & Associates (M&A) initiated this transaction and acted as exclusive financial advisor to BFT. M&A is a specialized investment banking advisory and consulting firm providing transaction advice and services to middle-market firms in the media, technology, information and business services sectors. The firm is based in New York City and Washington DC. For further information, visit www.MarlinAndAssociates.com.

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