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Iris Software Group announced Tuesday that it has reached an agreement to acquire Dext, a financial recording platform, from global private equity firm Hg. The move aims to enhance Iris' cloud accountancy offerings in a growing sector.

Deal Terms and Strategic Benefits

While the financial terms of the transaction were not disclosed, the acquisition values HgCapital Trust's investment in Dext at approximately £32.7 million, marking a £3.6 million increase in the platform's value since September. Iris expects the deal to close in December.

Iris' CEO, Elona Mortimer-Zhika, emphasized that the acquisition would improve the automation features of its accountancy cloud software portfolio. “We are doubling down on our promise to build and offer the most compliant cloud solutions that deliver our customers the highest levels of productivity and engagement,” Mortimer-Zhika stated. She added that the deal will allow Iris customers to focus more on client advisories, business growth, and other core activities.

Enhancing Integration and Expanding Offerings

The acquisition will also enable Iris to expand Dext’s product lineup and inject capital into its partner integration program. Currently, this program connects to over 35 bookkeeping software platforms and more than 11,500 banks and financial institutions.

Both Iris and Dext platforms are compatible with various accountancy software and bookkeeping providers, allowing users to continue utilizing their preferred tools. The Iris Elements platform provides essential functionalities like practice management, accounts production, and tax returns. Meanwhile, Dext streamlines bookkeeping by automating routine tasks, improving productivity.

Iris anticipates that the combination of both platforms will provide a comprehensive solution, from data entry and processing to compliance, reporting, and advisory services.

Exciting Future for Dext and the Accounting Software Market

Dext’s CEO, Sabby Gill, described the deal as an "exciting new chapter" for the company. He noted that the partnership would accelerate product innovation, expand Dext’s integration program, and offer a complete, end-to-end solution for customers.

According to data from Mordor Intelligence, the accounting software market is expected to reach $20 billion by 2024, with projections indicating a growth rate of 9.2% annually until 2029, when the market is expected to be valued at $30.6 billion. The research highlights that small and medium-sized businesses are increasingly attracted to cloud-based accountancy solutions for their ability to simplify and automate complex financial reporting.