If you are wondering what happened to Vin Murria after she sold CSG to the IRIS Group, then read this new posting by IT industry analyst Richard Holoway on his Holoway's HotViews blog – http://hotviews.blogspot.com

“My involvement with Vin Murria came about through Elderstreet
where she is a Director and I am an adviser to one of their funds.
Indeed, our investment in Computer Software Group (CSG) – where Michael
Jackson served as Chairman and Vin Murria as CEO – was the most
successful for the fund when it was sold to HG Capital in March 2007
for c£100m. CSG was a consolidation play in the legal, not-for-profit,
membership arena – and it worked very well for shareholders. Jackson
and Murria stayed with the new entity which merged with Iris and was
then sold to Helman & Friedman for c£500m – in hindsight, probably
at the top of the market!


“Well, now the duo are at it again. This time in the UK primary care arena. Via an AIM ‘shell’ called Drury Lane Capital plc, they have acquired (actually it’s a reverse takeover) Adastra for £12.2m (£4.8m in cash, rest in shares). Drury Lane (which I understand will change its name to Advanced Computer Software plc when the deal is consummated) is raising £14.6m by way of a placing of 86m shares at 17p.

“Adastra
was setup in 1994 by Lynn Woods and James Berry (both of whom will
continue post the acquisition). In 2002 they acquired their main
competitor, Owl Software. In the year to 29th Feb 08 Adastra had
revenues of £10.6m, PBT of £1.7m and 150 staff. A significant majority
(>70%) of revenues comes from recurring support revenue and from
software sales to existing clients. Adastra’s main product is a
specialist call management, data distribution and clinical recording
systems for GP out-of-hours or urgent care. Adastra has more than
doubled its revenues in the last five years.


“Adastra has an almost clean sweep of out-of-hours systems in the UK with no direct competition.

“If ever there was a UK market ripe for consolidation it is the Out of Hospital Care area (which goes under the acronym OoH)

“Firstly,
there are a whole array of relatively small companies who service the
area. For example, EMIS (revenues c£50m) is one of the main suppliers
of primary care/GP systems but partners with Adastra on out-of-hours.
There has been speculation in the past that EMIS(*) might itself purchase
Adastra – maybe it will be the other way around now!


“Secondly,
the benefits of ‘cross-selling’, which would accrue if the group was
enlarged, are obvious. Don’t just think doctors – think dentists,
opticians, pharmacists, walk-in-centres, polyclinics (the latest DoH
buzzword) etc


“Thirdly, the current disarray in the NHS IT
Programme might play well with a consolidation exercise. The NHS has
recently given greater flexibility for local trusts to work with local
suppliers of their choice. This can only benefit the smaller
established suppliers over the last remaining LSPs (BT and CSC).


“Lastly,
users of such systems are very loyal. Training and implementation costs
are high so users only change as a last resort. That means that
recurring revenues are both secure and significant – exactly the kind
of model of businesses that work in a consolidation play.


“Clearly,
this is a development I will watch with great interest. If anyone can
pull off a consolidation play in the primary care area, Vin can.”

* The EMIS referred to in this story is the parent company if EMIS IT who operate in the legal IT market.