BGF exits Scottish IT firm Kick ICT as Lloyds offshoot LDC comes on board

Current management team will continue to be led by CEO Tom O’Hara

BGF, the active investor formerly known as the Business Growth Fund, has completed a successful exit from Bellshill-based Kick ICT after a “strong” 38 per cent return.

The investment outfit originally pumped £8.5 million into the IT managed service provider, which employs more than 170 staff, in 2021 and has worked with the company since then to support its growth, capabilities and market presence. LDC, the private equity investment arm of Lloyds Banking Group, said it had now made a “significant” investment in Kick ICT, which was founded in 2015.

BGF’s investment enabled the firm to continue on its acquisitive growth strategy, with the notable acquisition of Consilium in 2022 and, most recently, Dundee-based C2 Software in November 2023. Geoff Neville, who BGF introduced to Kick ICT as independent chairman, will continue with the business, as will the current management team led by Tom O’Hara.

The exit, which was led by BGF investor Richard Pugh, delivered a 38 per cent internal rate of return on the investment. This has been described as a strong return for BGF in a “relatively short period of time, reflecting the excellent performance of the business and level of future opportunity”.

O’Hara, chief executive at Kick ICT, said: “BGF’s investment in 2021 allowed us to continue to deliver our ambitious growth strategy, and they were a fantastic partner as we implemented our buy and build approach, and strengthened the senior team in preparation for the scale of opportunity we see in front of us. This will now continue with LDC, and we are excited about the opportunities ahead.”

Pugh added: “We’ve thoroughly enjoyed working with Tom and the team at Kick ICT to deliver fantastic business growth since our original investment in 2021. Rapid progress meant all parties were able to realise their objectives ahead of schedule, and now with the incoming investment from LDC, the time was right for us to exit the business. We look forward to seeing Kick ICT go from strength to strength in future.”

BGF was set up in 2011 and has invested in excess of £3.5 billion in more than 500 companies. It invests in growing businesses in the UK and Ireland through its network of 15 offices.

The LDC investment in Kick ICT was led by investment directors Lee Donaldson and Aaron Lawson-Clark and investment manager Emma Borrie. The firm is backing Kick ICT’s existing management team, led by O’Hara and group sales director Alan Turnbull.

Donaldson, investment director at LDC in Scotland, said: “The rapid pace of digitalisation across the economy means dynamic businesses like Kick ICT will be at the forefront of growth across the UK ICT sector in the years ahead. Tom and Alan are committed and ambitious founders, and we’re excited to support them, alongside the rest of the management team, as they continue their impressive run of acquisitions to drive growth and expand the business outside Scotland.”

LDC has a successful track record in the IT and communications sector, having made more than 20 investments into businesses with a total enterprise value of £1.4bn, since 2012.