Capital-based tech firm and Spanish player seal merger

The Withers have retained a financial interest in the group, as well as a seat on the board. Picture: contributed.
The Withers have retained a financial interest in the group, as well as a seat on the board. Picture: contributed.
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A hospitality and leisure focused tech firm founded by a husband-and-wife team, and whose clients include Soho House, The Hoxton, Sodexo and Diageo, has unveiled a merger with a Spanish player in the same sector.

The deal completed today. Flow Hospitality Training, an Edinburgh-based software-as-a-service (SaaS) learning platform, has teamed up with Mapal Software, a Madrid-based developer and supplier of workforce management and business analytics software.

The transaction expands the range of SaaS services the merged business will provide its existing and “rapidly” growing client base in the restaurants, bars, hotels and coffee chain sub-sectors, from its centres in Europe, UK and the US.

Following hot on the heels of its investment in Mapal in September 2019, Flow represents the second hospitality platform acquisition by Providence Strategic Growth, the growth equity affiliate of Providence Equity Partners.

Edinburgh entrepreneurs Ruth and David Wither founded Flow in 2009, and its clients use its technology-driven interactive and intuitive learning platform to boost their customer and market offerings.

The merged business will be led by Mapal founder and chief executive Jorge Lurueña, with the Withers electing to gradually step back from day-to-day leadership.

Combination

The two firms’ senior management teams will be combined and all staff in both firms will be retained and employee numbers grown as the new enterprise extends its reach. The Withers have retained a financial interest in the group, as well as a seat on the board.

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EY Scotland’s corporate finance team, led by Ally Scott, originated the transaction as sole financial advisers to the shareholders of Flow Hospitality and introduced the opportunity to Providence and Mapal. Addleshaw Goddard, Edinburgh, were legal advisers to Flow.

The latter’s chief executive David Wither said the company has “tremendous” growth opportunities and was keen to secure major investment to reach its full potential.

“It was, however, incredibly important to Ruth and me to get the right fit for the business and find like-minded investors and partners to go forward with.” He also said the firm is “confident of continued growth and success going forward”.

Scott, head of transaction advisory services and managing partner for EY Scotland, said: “A deal such as this is further indication of the vibrancy and ambition we have here in the Scottish middle market. Despite ongoing uncertainty, Scotland’s key sectors are in growth mode and we are seeing opportunities domestically and internationally for those looking to expand their operations through [merger and acquisition] activity.”