Tax Systems has been acquired by Providence Equity Partners

Arrowpoint Advisory’s Management Advisory team has advised the management of Tax Systems, the global tax and accounting software provider, on its sale from shareholders Bowmark Capital, the mid-market private equity firm, to Providence Equity Partners.

Founded in 1991, Tax Systems is a leading specialist provider of software and solutions which digitise the tax compliance process – enabling tax professionals to automate workflows, enhance compliance, mitigate risk and generate valuable insights from their tax function. The company now serves over 1,500 clients, including multinational enterprises, >80% of the top UK&I accounting firms, and approximately 40% of the FTSE 100.

Since Bowmark completed the take-private of the company from AIM in 2019, Tax Systems has doubled its revenue and profits. As a result of continued investment, the company has developed the industry’s leading, cloud-native, multi-tax technology platform.  Most recently, it launched Pillar2, its AI-powered SaaS solution to address the complexities of the OECD’s global Pillar Two compliance and reporting.

Providence’s investment will support Tax Systems’ continued platform expansion and innovation, targeting new tax and regulatory compliance solutions in existing and new geographies.

Karim Tabet, Senior Managing Director, Co-Head of Europe at Providence, commented: “We are excited by the opportunity to partner with Tax Systems. Throughout Bowmark’s ownership, the company has developed into a specialist leader in regulatory and compliance software. We believe this is a large and fragmented category, with constant changes and strong digitisation trends that provide potential for numerous growth avenues.”

Bruce Martin, CEO of Tax Systems, said: “We have enjoyed an excellent and rewarding partnership with Bowmark, whose support has been instrumental in strengthening our position in core markets, expanding our product suite, and successfully entering new geographies. As we move into our next phase of growth, we are excited to be partnering with Providence, who recognise the strength of our business and the significant opportunities ahead. Their support will help us accelerate our expansion and innovation as we continue building the leading tax compliance software platform in EMEA.”

Bruce went on to share: “Arrowpoint Advisory’s guidance for the management team throughout the process was invaluable – their expertise and commercial approach, both at a strategic level and in the detail, helped us navigate the complexities of the transaction and deliver us an overall incentive package which should deliver an exceptional result – we look forward to working with them again in the future.”

Simon Kaufman, Partner at Bowmark, commented: “We are proud to have supported the Tax Systems management team in the development of the business since 2019. The company has an exceptional reputation and, following significant investment in its product suite and a highly complementary international acquisition, there is much opportunity ahead.”

Simon Cope-Thompson, Managing Director at Arrowpoint Advisory, concluded: “We are delighted to have supported Bruce and the wider management team on this transaction.  With Providence’s support, we look forward to watching Tax Systems go from strength to strength during the next phase of its growth and we wish the team every success going forwards.”

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