[sims] Capita is trying to sell off non-core businesses (SIMS is for sale)

[enjay]

If Civica purchase it we are all doomed

 

But they did such a good job of taking over Mintclass. Oh wait, no they didn't! Support responses went from minutes to days.

 

Unfortunately I suspect Civica are one of the companies who are counting out their piggy bank to see if they've got £500m. With other educational services already in place, pulling a big customer base across because of the MIS, ditching FMS and linking it to their finance systems seems like quite good business sense, and would help stem the flow,or at least redress the balance, of people ditching Corero for something better.

[FishCustard]

Given that Civica shut down their support site (Userbase - where you get everything from KB articles to product updates) before having the replacement ready, I think Civica are the last people I want buying SIMS.

[nathan]

I emailed James Leonard (Head of Google for Education UK) and told him to snap it up and give it a proper makeover..... They would not notice 500m.

 

Why waste half a billion on buying code that needs a complete rewrite - i know there are other valuable assets, but half a billion is a lot of money.

[supportman]

Why waste half a billion on buying code that needs a complete rewrite - i know there are other valuable assets, but half a billion is a lot of money.

 

Because 90% of customers haven't moved in the last 10 years which shows that existing customers are very valuable.

[nathan]

Because 90% of customers haven't moved in the last 10 years which shows that existing customers are very valuable.

 

but as mentioned prior, they are losing those customers quickly moving to SaaS products - Something that Google would need to code from the ground up either way.

[RootsSchImp]

but as mentioned prior, they are losing those customers quickly moving to SaaS products - Something that Google would need to code from the ground up either way.

 

A lot of the recent losses have been academies who got hit with much higher prices for SIMS when they converted. Not saying they won't continue to bleed customers, but it's far harder to pry away the LA schools who're generally paying less and have more complicated contracts where the school pays for some things and the LA others.

 

SIMS remains broken, but it's still got a lot of money coming in and might hang around for a surprising amount of time, so while £500m is on the high side I don't think it's out there crazy.

[supportman]

but as mentioned prior, they are losing those customers quickly moving to SaaS products - Something that Google would need to code from the ground up either way.

 

I know, we are one of those customers who moved I guess capita are trying to sell before those customer migrations show up in the actual financial figures in any real amount.

 

I don't understand how they would ever build a SASS product out of Sims anyway, its far too complicated to migrate with too much legacy cruft.

[paulkerton]

SIMS remains broken, but it's still got a lot of money coming in and might hang around for a surprising amount of time, so while £500m is on the high side I don't think it's out there crazy.

 

Sorry, but £500m is very high for what you would get, especially considering where SIMS 8 currently is. £500m is the low end of what they'd like. They're aiming for up to £700m which is like I've previously said 20% of the value of the entire EdTech market as expected next year (pre Coronavirus, so that might need adjusting - making the figure an even higher percentage)

There is absolutely no way, after everything that has happened around remote working, that SIMS comes out of the other side of this remote working situation without losing a lot more customers too. £500m is high, and because of that I'd be a little concerned about who the interested parties will be.

[nathan]

I know, we are one of those customers who moved I guess capita are trying to sell before those customer migrations show up in the actual financial figures in any real amount.

 

I don't understand how they would ever build a SASS product out of Sims anyway, its far too complicated to migrate with too much legacy cruft.

 

They started with SIMS Primary, no idea where that ended up

[HPlum78]

500m is not just for the educational arm, they are lumping in ~10 business units.

[paulkerton]

500m is not just for the educational arm, they are lumping in ~10 business units.

 

https://uk.reuters.com/article/uk-capita-divestiture/british-outsourcer-capita-to-sell-two-software-units-idUKKBN23Q34J

 

"The FTSE-250 firm will look to sell its ESS unit, whose platform SIMS is used by 21,000 schools in England, Wales and Northern Ireland, for at least 500 million pounds ($617 million), the EducationInvestor Global website reported."

[HPlum78]

I read that it included more but that don't seem to be the case, so yeah it's about 499m too much :-p

[paulkerton]

I read that it included more but that don't seem to be the case, so yeah it's about 499m too much :-p

 

So far we've ascertained the following:

✅ SIMS

✅ Reading Cloud

✅ UNIT-e

✅ AGILIT-e

❌ FMS/SIMS Finance

❌ Capita One

🤷 EducationSpace

[Ditto]

...but it's far harder to pry away the LA schools who're generally paying less and have more complicated contracts where the school pays for some things and the LA others.

This is a good point and one of the reasons I think it will retain market share for a good time yet. On the flip side, if LA's start to migrate away and momentum builds up, you would see big chunks of market share going at a time. Additionally, although lower priority nowadays, I think the government will continue to promote academisation. I just hope that any buyer does good due diligence.

[LazyD]

If I had a spare £500 million I would buy it just to burn the source code so that it never sees the light of day again.

 

I can put in £40 to start the ball rolling if that helps?

[HPlum78]

I will throw in £60 to get us to the £100 mark, I am beginning to think that we are close to being serious contenders here!

[paulkerton]

... Can we crowdfund this?

[dmj]

I will throw in £60 to get us to the £100 mark, I am beginning to think that we are close to being serious contenders here!

 

Looking at their share price, we're not far off buying the whole company

 

 

[supportman]

Looking at their share price, we're not far off buying the whole company

 

 

[ATTACH=CONFIG]58560[/ATTACH]

 

Just horribly in debt. Basically a junk stock these days. Thats why they never invested in Sims or any other of their software services. Sinking ship!

 

Whoever buys Sims would be mad to pay 500 million. Firesales don't work that way.

[paulkerton]

Whoever buys Sims would be mad to pay 500 million. Firesales don't work that way.

 

Absolutely. The sale is in the buyer's hands here. Buyers could simply sit back and wait for the company to go bump and get it at a lower price.

[NickBryson]

No but I'd expect a reseller agreement to be put in place.

Phil surely the sale includes FMS but not SIMS Finance as the underlying product is from a part of Capita outside ESS ?

[FN-GM]

What if it doesn’t sell? Do they liquidate the remaining assets that have value?

[PhilNeal]

Phil surely the sale includes FMS but not SIMS Finance as the underlying product is from a part of Capita outside ESS ?

 

Nick that would be what I would expect but I'm not an insider anymore! FMS is definitely a ESS product. I doubt if SIMS Finance is included in the sale but as it was adapted by ESS to suit the academy market, I'd expect some sort of reseller arrangement.

[Ditto]

MIS market update from @bringmoredata at Bring more data: Expect MIS switching volumes to decline in 2019/20. The latest figures alone won't put potential buyers off and would suggests there's a bit more cash to be milked from the cow! Q2 is likely to be a more interesting report in due course. It will be interesting to see if Covid-19 delays MIS switching in the short term but leads to a bigger surge later.

[enjay]

It will be interesting to see if Covid-19 delays MIS switching in the short term but leads to a bigger surge later.

 

That's certainly plausible, as working from home without the MIS will have prompted lots of people to consider online alternatives.