A bidding scramble is unfolding for the revenue and benefits subsidiary of IBS OpenSystems after the UK Competition Commission ordered Capita to sell it. The watchdog has confirmed that the deal has resulted in a substantial lessening of competition in the market for revenues and benefits software systems. Idox and Civica have been touted as the most likely bidders for the system, which was brought by Capita in June last year for £78m. At the time, analysts regarded the price as high for a business with a turnover of £21m. Analysts also said the business may fetch £15-£20m. In the past, Civica, Idox, Mouchel and Consillium Technologies have shown interest in the system. It is thought Northgate Information Solutions, acquirer of Anite's public sector business for £53.4m last year, will not be able to bid for competition reasons. Capita chief executive, Paul Pindar, was adamant the company would not feel the loss. ‘The broker's consensus is for us to make £323m in profits this year, so losing a business that is sub-£2m in profits is not a great blow for is,' he said. ‘It is a separable business and we're going through the divestment processes as we speak. ‘I have had six different inquiries today from private equity and other trade buyers, and we are quietly confident we can find a solution.' The local authority software market has been consolidating in an effort to dominate an area of technology most likely to be insulated from the recession. The news comes as Capita continue to expand its reach. It has recently acquired the loan administration Capmark Financial Group and urban design consultants Andrew Martin Associates.
