Fast Moving UK IT Services Sector to receive investment funding

December 06, 2011:  The shifting of IT and e-commerce applications to the cloud is opening up huge opportunities for the IT outsourcing companies in UK IT industry. This will lead to more investments from private equity firms reaching to IT outsourcing firms and other specialist agencies like Investec in the year 2012.

It is often observed that IT outsourcing service providers utilize extra investment to enhance capacity, increase security protection and to obtain more powerful networking and communications equipment. It is highly important for IT service providers to maintain highly reliable and secure systems, as a part of the requirement of the client to meet the service level agreements (SLAs) and to prevent financial losses or damage to reputation as a result of system downtime. 

According to John Clifford from Investec, the UK IT industry poised for a strong growth during 2012 and in the years to come. He said that with the growth to be observed, investment firms and investors are ready to invest in the sector. He added that the IT service providers will need access to more capital to fulfill the infrastructure requirements to meet the needs of client. This presents with a huge opportunity to for any lenders including Investec, which offers flexible and wide range of financial services to mid sized service providers.

They offer financial services to mid sized service providers trying to raise capital between 5 million and 50 million pounds as a part of their organic or acquisition growth strategies. In August 2011, Investec raised for Darwin Private Equity , senior debt finance to help them secure a controlling stake in Attenda, a major IT managed services firm.

The troubled market conditions have fuelled demand for IT services as companies look for ways to reduce cost. Outsourcing of software development, hardware and maintenance to third party service providers will help companies to reduce their cost. Outsourcing not only reduces cost, but also helps in improving quality of service using standardized solutions and expertise of the service provider.

More over the quantity of digital data is exploding. It is found that 3 million emails are sent every second and the data processed by Google has reached 24 petabytes. The exploding quantity of data calls for increase in the capacity of storage devices and related security infrastructure, which can be provided by third party providers at a lower cost. All these factors will lead to increased IT outsourcing during 2012.

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