Fourth, a global SaaS provider of labour, payroll, inventory and procurement systems for the restaurant/bar, hotel, contract catering and leisure markets, has acquired Adaco, a supplier of SaaS based purchasing and inventory control solutions to the hotel sector in the US and worldwide. Fourth is backed by UK mid-market firm ECI Partners.
Fourth, the global SaaS provider of labour, payroll, inventory and procurement systems for the restaurant/bar, hotel, contract catering and leisure markets, announced today the acquisition of Adaco Inc. (“Adaco”), the leading supplier of SaaS based purchasing and inventory control solutions to the hotel sector in the US and throughout the world.
With over 400 customers in 54 countries and a 27 year history, Adaco has an excellent reputation in the hotel sector and will continue to operate from its Connecticut base in the US, supported by the Fourth team in London, England. The Adaco office will become the operating base for Fourth USA.
Fourth and Adaco have strong product offerings in their respective markets and clear development roadmaps, with increased benefits envisaged for all customers through tight collaboration and the sharing of technical expertise. With nearly 250 employees, the combined businesses will have access to more resources in development and customer support, across Europe and the US, as well as the financial support of ECI Partners, a leading private equity firm.
Ben Hood, Fourth CEO commented “We are delighted with this acquisition as it fits well with our international ambitions. I am excited that Sunil will be joining our senior management team and feel this will be a great opportunity for all Adaco employees. Adaco has a fantastic reputation for innovative solutions for the hotel sector and the synergies are considerable. We both share a deep commitment to providing business process efficiency, excellent ROI, and significant improvements in gross profit for our customers.
Sunil Reddy, President of Adaco said “Fourth’s acquisition enables us to extend our global reach as part of a large, well-funded and ambitious organisation. I am looking forward to joining the Fourth Board in my on-going role as Adaco President and working closely with its management team. The culture and vision of Fourth and Adaco are very similar which is exciting.”
Combining two strong businesses enables Fourth to increase its international footprint, with a major presence in over 50 countries including North and South America, Europe and the Middle East and Russia. It also provides a springboard for new business opportunities in the Far East. A global network of partners and resellers will play a major part in future growth.
David Ewing, Director at ECI Partners, Fourth’s private equity investors, commented “International expansion is a key part of the growth plan we are supporting at Fourth. Since our investment, Fourth has continued to perform strongly and we are pleased to support the Adaco acquisition with further funding.”
Stuart Layzell, Fourth CFO added, “We are excited about working together to build on our existing market position. The combined group will have sales in excess of £23m ($36m) with healthy margins and cashflows. The on-going financial support from HSBC and our shareholders is a great vote of confidence in our growth plans.”
Funding for the transaction was provided by HSBC Bank plc, ECI Partners LLP, Derek and Edwina Lilley along with the senior management of Fourth. Fourth was advised by White & Case LLP, Pinsent Masons LLP and PricewaterhouseCoopers LLP. Adaco and its shareholders, Sunil and Uma Reddy, were advised by the McLean Group LLC and Blank Rome LLP.
Fourth Hospitality Limited | 90 Long Acre | London | WC2E 9RA | Telephone +44 (0) 20 7534 3700 | fourthhospitality.com
Fourth employs 200 people, with offices in London and Cheshire and is the leading provider of completely integrated cloud-based solutions for the hospitality industry in the world. Its solutions are used by the hospitality sector at 13,250 sites in 22 countries. It has 651 customers including: restaurant groups Gondola, Tragus, Carluccio’s and Jamie’s Italian; fast-food groups Krispy Kreme and Subway; pub groups Spirit, Fuller’s, Marston’s and Stonegate; hotel groups Intercontinental Hotel Group, Hilton and Starwood, and leisure customers such as Center Parcs and Merlin, plus catering organisations such as SSP, Sodexho, MITIE and Aramark.
Adaco is the global leader in purchasing and operation control solutions for hospitality industry. With over 400 customers its products are used in 54 countries by the world’s leading hotel groups including Marriott, Starwood, Loews, Fairmont, Wyndham, Ritz Carlton and Jumeirah.
About ECI Partners
Founded in 1976, ECI is one of the leading UK mid-market private equity firms. With offices in London and Manchester, ECI specialises in management buyouts, buyins and development capital deals with companies valued between £10 million to £150 million. Specialising in TMT, business services, industrial, healthcare and consumer companies, ECI has worked with both investment and management teams and successfully sold over 85 investments with a total value of over £2.5 billion since 1990. ECI remains a natural partner for companies with growth potential and ambition.
ECI Partners is committed to supporting growth at the companies it backs: an important feature of ECI’s operating capability is the Commercial Team which has been engaged with both new and existing investments in the ECI portfolio. The team supports 100 day planning programmes and also focuses on strategic development projects, ranging from marketing and sales effectiveness to international expansion opportunities. The team partners with management to help accelerate growth, bringing to bear both dedicated resources and the networks and contacts developed by ECI Partners over the past three decades.
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