Ethos is pleased to announce the buyout of Compliancy Services, the UK-based provider of compliance consultancy and RegTech services for firms that offer regulated financial services.
The transaction was led by Ethos Partners, whose principals and HNW investor base provided equity funding to support the acquisition. Ethos Partners is a private investment office set up by private equity professionals to provide £3-10m of supportive equity capital to established, ambitious UK companies.
Founded in 2003, Compliancy Services is a market leader in its sector. Compliancy Services addresses an attractive growing market driven by regulatory change and provides business-critical services to a broad spread of regulated financial services clients. They help clients become authorised by the Financial Conduct Authority (‘FCA’) and the Prudential Regulation Authority (‘PRA’) and manage their ongoing compliance and regulatory obligations.
The transaction facilitates the retirement of founder Iain Stephen, with majority shareholder and current Chairman Ben Mason retaining a significant minority shareholding in the business and staying as a Non-Executive Director.
In partnering with industry veteran Philip Naughton as CEO, the buyout presents an opportunity to continue to support its clients who face an ever-increasing regulatory burden via regulatory updates, consultations and thematic reviews and providing a cost-effective outsourced and partner solution for clients’ compliance function.
Philip Naughton, CEO, said:
‘I am delighted that Ethos have invested in Compliancy Services to pursue our growth strategy over the next few years, in particular in the Capital Markets and Payment Services space. I have known some of the Ethos team professionally for a number of years and, having worked closely with them over the last few months, I know they will be supportive of Compliancy Services as we enter the next phase of growth.’
Scott Bannerman, Investment Director at Ethos, commented:
‘We are delighted to be supporting Philip with the buyout of Compliancy Services. Ben and Iain have built a fantastic business serving clients across the financial services landscape. With an ever-increasing cost for FCA and PRA registered firms to remain compliant with regulations, Compliancy Services are, with the support of a senior team which includes ex-regulators and subject matter experts, well placed to drive continued growth of the business.’
Ethos was advised on the transaction by HMT Corporate Finance (financial), Latitude Consulting (commercial), Confidas People (management), and Harrison Clark Rickerbys (legal). Compliancy Services were advised by Ian Barton of Quantuma and KBS (corporate finance), FSP (legal) and DWF (management advice).