OPN

AIE

A 3i (III)-backed management buy-out of Civica (CIV:AIM) means another software and services sector stock has been snapped up, prompting further speculation about who could be next.

Civica, which provides software, consulting and managed services to the public sector, had already been the subject of a private equity bid last summer. This was scuppered by the credit crunch and the Putney firm’s shares leapt 32% to 266p as investors welcomed the fresh 270p-a-share cash offer.

The deal reaffirms the value of the strong cashflow generated by Civica peer IBS OPENSystems (OPN:AIM), which trades on a prospective PE of barely eight for 2008, and could reignite speculation surrounding Anite’s (AIE) public sector operation.

Chelford, CODA, ICM Computer, iSoft, Northgate Information Solutions, SurfControl and Vega are all software and IT services firms to have recently been acquired by trade or financial buyers. Russ Mould

Shares says: Buy Anite, IBS OPENSystems