Providence Equity Partners, a private equity firm specializing in growth-oriented sectors, has acquired Tax Systems, a global provider of tax and accounting software, from Bowmark Capital. This investment aims to enhance Tax Systems' platform expansion and innovation, focusing on new tax and regulatory compliance solutions across various regions.

Founded in 1991, Tax Systems has established itself as a leader in digitizing the tax compliance process. Its software solutions help tax professionals automate workflows, improve compliance, reduce risks, and derive insights from their tax functions. The company serves over 1,500 clients, including many multinational enterprises and a significant portion of the top accounting firms in the UK and Ireland, as well as around 40% of the FTSE 100.

Under Bowmark's ownership since 2019, Tax Systems has seen its revenue and profits double. The firm has invested in developing a leading cloud-native, multi-tax technology platform. Recently, Tax Systems launched Pillar2, an AI-driven SaaS solution designed to tackle the complexities of the OECD’s global Pillar Two compliance and reporting requirements.

Providence Equity was advised by several firms, including Arma Partners for M&A and White & Case for legal matters. Bowmark received guidance from Houlihan Lokey for M&A and Deloitte for financial and tax services. Tax Systems was advised by Arrowpoint Advisory for M&A and Burness Paull for legal issues. The financial details of the acquisition were not disclosed.

Key executives expressed enthusiasm about the acquisition. Karim Tabet, Senior Managing Director at Providence, highlighted the potential for growth in the fragmented regulatory and compliance software market. Daniel Zwicky, a Director at Providence, noted their commitment to supporting Tax Systems' growth through innovation and strategic acquisitions.

Bruce Martin, CEO of Tax Systems, reflected on the successful partnership with Bowmark, which helped strengthen their market position and expand their product offerings. He expressed excitement about partnering with Providence, emphasizing their recognition of Tax Systems' strengths and the opportunities for future growth.

Simon Kaufman, a partner at Bowmark, praised the management team's development of the business since 2019, noting the company's strong reputation and the potential for further opportunities following significant investments and strategic acquisitions.

Overall, the acquisition positions Tax Systems for accelerated growth and innovation in the tax compliance software sector, leveraging Providence's resources and expertise to expand its reach and enhance its offerings.