Photo by: Bloomberg
South African private equity investor Ethos has sold its investment in niche technology company CQS Investment Holdings, which distributes software products for the audit, risk management and financial reporting markets, to JSE-listed Adapt IT.
Ethos Technology Fund I acquired CQS in 2008 in a transaction that facilitated the introduction of empowerment partner, Kapela Investments. Ethos had now sold its entire stake, rendering Kapela and its management shareholders of Adapt IT.
The announcement followed significant investment activity by Ethos over the past 12 months, including the acquisition of Pan-African telecommunications towers company Eaton Towers; paper-based packaging solutions group Neopak; branded tissue products manufacturer Twinsaver; automotive parts retailer Autozone; and, most recently, work-at-height solutions provider Eazi Access.
Notable realisations last year included the disposal of Plumblink to JSE-listed Bidvest and the sale of Ethos’ shareholding in JSE-listed Transaction Capital in December.
Commenting on the CQS disposal, Ethos CEO Stuart MacKenzie described Adapt IT as a “natural home” for CQS, with the partnership likely to unlock significant synergies for both parties.
“Ethos has been a supportive and stimulating shareholder which, beyond capital, financial and strategic expertise, gave CQS access to its significant business networks. Today, CQS is well-corporatised and ready to take a new step in our journey,” noted CQS CEO Ashley Cohen.
Ethos principal Kameshan Chetty added that CQS was a “fantastic” strategic acquisition for Adapt IT and that the group expected the business to grow strongly under the information technology company’s ownership.