2 March 2010

Octopus Capital for Enterprise Fund invests £2 million supporting the merger of document management businesses Stortext FM and BOX-IT

Octopus Ventures (Octopus) today announced an investment of £2 million from the £30 million Octopus Capital for Enterprise Fund (OCfE) into BOX-IT, a UK wide document storage business. The investment will support the merger with Stortext FM Limited, a specialist electronic archiving and workflow solution company, to create a “one-stop-shop” provider of document management solutions in the UK.

BOX-IT is a growing physical document storage business serving the whole of the UK from its Winchester base and through an established network of franchise operations. The merger with Stortext, will benefit from the cross-selling of integrated services to both existing and new customers, accelerating the growth potential. The enlarged group is well placed in this growing market, driven by the need for customers to increase efficiencies, drive down costs and comply with increasing regulation. The transaction was supported by debt funding from HSBC, Southampton.

Rupert Bell, Investment Director, Octopus Ventures, said: “BOX-IT has continued to grow over the past few years, demonstrating its resilience to the economic downturn, which is testament to the quality of its offering and management’s focus and drive. The team identified Stortext, having partnered with them over the past few years, as a good strategic fit for its business and are excited about the prospects for growth. The investment from the Octopus Capital for Enterprise Fund has enabled the company to become a mid-market full service provider to the document management sector to rival larger competitors.”

Simon McCowen, founder and executive chairman of BOX-IT, said: “We have built a successful UK-wide document storage business based on our consistent quality of service. The market has changed significantly over the past decade, and whilst paper storage will continue to grow through regulation, we see an opportunity to diversify into the growing electronic document management market. Stortext offers unique in-house technology with its award winning Omnidox product giving customers access to their electronic documents from anywhere in the world. Bringing the two businesses together cements our existing partnership and creates a unified full service provider. Octopus and Carabid have been instrumental in unlocking this opportunity for BOX-IT and we look forward to working with them through the next phase of growth.”

Simon Ellis, CEO of BOX-IT, said: “This investment is great news for BOX-IT and Stortext FM, facilitating a transformational step for both businesses. Benefitting from the experience of a combined management team, we are working hard to ensure an efficient and smooth integration and are excited about the growth opportunities ahead of us.”

Rupert Bell and Scott Barham led the deal on behalf of Octopus. Octopus’ principal advisers were CMS Cameron McKenna (legal), CIL (commercial diligence), and BDO (financial diligence). Harry Dhand and Andrea Errington from Carabid provided corporate finance support to BOX-IT with legal advice from Paris Smith. Ben Knowles led the debt funding from HSBC.

-ENDS-

Media Enquiries

Octopus Investments
Sharon Makin
020 7710 6470
press@octopusinvestments.com

BOX-IT
Simon Ellis
0800 220 707

Notes to Editors

About Octopus Investments Ltd (www.octopusinvestments.com) Established in 2000, Octopus Investments is a leading investment specialist, providing investors with access to a growing range of innovative investment solutions including a discretionary management service, a range of single manager funds; equity OEICS, venture capital trusts, enterprise investment schemes and inheritance tax solutions. Since inception, Octopus has grown its customer base to over 22,000 with funds under management of over £1.4 billion. Octopus was voted ‘VCT Provider of the Year’ in 2007, 2008, 2009 and 2010.

Octopus was voted the top UK financial services company to work for in the Sunday Times survey of ‘Best 100 SMEs to Work For’ in 2008 and was re-listed in the top 100 companies for 2009. Additionally, the Company won the ‘Badenoch & Clark Business of the Year’ award and the ‘3i Growth Strategy of the Year Award’ at the 2008 National Business Awards, Regional Finals, South East of England, in July 2008, and the ‘Business of the Year’ award at the 2009 National Business Awards, Regional Finals, South East of England, in July 2009. Octopus has over 100 staff with 30+ investment professionals.

About Octopus Ventures (www.octopusventures.com) Octopus Ventures, a division of Octopus Investments, manages circa £250 million in VCT and EIS funds as well as the £30 million Octopus Capital for Enterprise (OCfE) Fund. Octopus typically invests from £500,000 to £5 million per investment and is a leading player in the UK venture capital industry. Octopus is a generalist investor, preferring to back exceptional entrepreneurial teams rather than specific sectors. Octopus looks for businesses which can create, transform or dominate an industry and is focused on the UK. Octopus has £125 million to invest in the next three years.