Business
Strategic Update
Strategic Update.
About this update from Aptitude Software Group Plc
[{"type":"text","content":"\n \nRNS Number : 8019T Microgen PLC 25 March 2019 \n\n25 March 2019\nMICROGEN plc ('Microgen' or 'Group')\nSTRATEGIC UPDATE\nMicrogen plc (LSE: MCGN) is a leading provider of business-critical software and services through its two operating businesses, Aptitude Software and Microgen Financial Systems. On the day of the release of the Group's audited preliminary results for the year ended 31 December 2018 it provides the following strategic update.\nFollowing the change in leadership of Microgen Financial Systems in October 2018 the Board has been exploring a range of strategic options with the objective of delivering maximum value to shareholders. \nThe Board believes that greater value will be realised through a simpler and more focused business targeted at the specialised financial management software market served by Aptitude Software. The Board has therefore concluded that a demerger of Microgen Financial Systems on to AIM will enhance Microgen plc's ability to allocate capital and management attention on the higher growth Aptitude Software business whilst also providing Microgen Financial Systems with the best ownership environment for it to successfully focus on its specialist target market and service its international customer base.\nHistorically both businesses benefitted from the combined financial and organisational scale of the Group. Firstly, the Aptitude Software business leveraged the more established corporate credentials of the wider Group when securing new business contracts with prospects for whom the corporate strength of a key supplier is a material consideration. With the growth experienced by Aptitude Software in recent years this benefit has reduced materially as demonstrated by Aptitude Software's 2018 revenue of £52.3 million being significantly ahead of the Group's total revenue in earlier years (for example, in 2013 the Group's revenue was £29.8 million of which Aptitude Software represented £14.7 million). The second key historical benefit from the combined financial and organisational scale of the Group were the operational synergies focused principally on back office administration. In recent years these synergies have largely been reduced as the finance, legal and human resources functions have been embedded into each business unit separately, to provide greater and more tailored support fo...