SSP users hopeful of investment as takeover nears completion

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Users have expressed hope that SSP’s expected takeover by Canadian-listed Constellation Software will lead to investment in the technology company as it exits private equity ownership.

Constellation, through its wholly-owned division Volaris Group, agreed to buy SSP for an undisclosed sum in December last year.

Constellation has been listed on the Toronto Stock Exchange since 2006 and defines itself as a software acquirer that “manages and builds vertical market software businesses that provide mission-critical software solutions”.

The deal is projected to complete this month “or shortly thereafter” once approved by the Financial Conduct Authority, SSP reported in a filing at Companies House.

“I hope it provides them with the financial stability to continue to invest in the platform,” Liz Mitchell, founder and managing director of Flood Assist Insurance told Post.

In her view the development was “really positive”.

“We took the platform because of the capability that SSP has in our chosen market of flood. It has probably more integrated Flood Re capability than any other platform,” she observed.

Users suffered from an outage at the software house last November.

“Outages are not great and every broker will tell you it is crippling,” she said adding that she had seen greater stability from the service and “enormously” improved levels of communication.

“The team are working really hard on it,” Mitchell stated pointing to plans and “no shortage of ideas” at SSP.

“They know what they need to do, they just need to deliver it,” she summed up.

Another SSP who declined to be named said he was also helpful of the takeover leading to a better service.

“Who knows with takeovers and it is difficult to gauge,” he commented.

“It is not the first time that SSP have changed hands so we will have to wait and see.”

SSP has been majority owned by Lloyds Banking Group’s private equity arm LDC since March 2015 when it backed a management buyout along with Scottish Equity Partners that valued the business at £207m.

Prior to this is was owned by PE firm Hellman and FriedmanH&F bought the technology company in 2008 when it was worth £198m. This came less than two years after SSP had floated on the Alternative Investment Market with a market capitalisation of around £70m.

Shortly after LDC’s investment SSP users were hit with a sustained outage in August 2016 leaving them unable to trade for up to three weeks. The event damaged relationships between the software house and brokers.

One software specialist told Post that years after the massive outage there were still questions as to whether firms would choose SSP over the offerings in the market.

“Just because something has been acquired its fortunes aren’t going to change,” he said. “It needs a change and it will be interesting to see what that entails.”

And he noted that it was a “a very competitive landscape” for insurer business.

“Notwithstanding the fact that they have been bought – and that [ownership] question is off the table – there are lots of other questions that people have. What are the plans?” he asked.

Another technology expert described SSP as a “a bit of a sleeping giant” but warned they were still “coming under a lot of pressure”.

In his opinion the issues for SSP were the “same as they have always had, a lot of disparate user communities and no nailed on successor products.”

Concluding: “Normally the acquirer has a target system they already own that they want to migrate everybody to or it is just possible they have deep pockets and want to go into new system development.

“We will find out over the next three months.”

SSP declined to comment when contacted by Post. Constellation Software have been approached for comment.

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