Tyler Technologies Paying $185M To Buy Va.-Based Software Firm

Tyler Technologies, the public sector juggernaut that has been a big player in state and local government digital transformation, said Friday that it will pay $185 million in cash to buy MicroPact, a Herndon, Va. software company that focuses on the federal market.

“Its exciting to us,” Tyler Technologies CFO Brian Miller told CRN. “Clearly, the expansion into the federal market is important for us. It’s something that we had on our radar for a long time, but wanted to find the right mechanism for doing that, which was consistent with our business model.”

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In MicroPact, a 22-year-old company that boasts deals with 98 percent of federal agencies with 500 or more employees, as well as 49 states, Miller said Tyler found the right fit, and sees room to grow.

“MicroPact certainly has established a really good presence in the federal market with a product -- really a platform -- that’s adaptable, easily configurable, low code environment for a wide range of case management, business process management applications. It fits really well with our product set, with our business model.”

Plano, Texas-based Tyler provides end-to-end information management solutions to more than 15,000 local government offices in all 50 states, Canada, the Caribbean, and Australia. Miller said in MicroPact -- which has annual revenues of about $70 million -- Tyler found a company with a similar solutions model, making the assimilation of the two companies much easier.

“We sell software as opposed to building one-of-a-kind systems, and that’s sometimes difficult in the federal market,” Miller said. “MicroPact certainly has established a really good presence in the federal market with a product really a platform that’s an adaptable, easily configurable, low-code environment for a wide range of case management, business process management applications. It fits really well with our product set, with our business model.”

MicroPact was founded in 1997 by CEO Kristoffer Collo. The company was previously known as MicroPact Engineering, but changed its name in 2012. Arlington Capital came to own MicroPact through its acquisition of Iron Data Solutions, LLC in 2011. That company was combined with MicroPact in 2015.

Tyler said it plans to close the acquisition of MicroPact in March, pending federal regulatory approvals. Collo plans to remain with the company, Miller said. Tyler plans to keep all 469 MicroPact employees.

“I think he felt that Tyler was a great home for MicroPact moving out of the private equity world and that we were a good acquirer for them,” Miller said. “Their management team is strong. Their culture is very compatible with Tyler. We felt a very strong connection there in terms of the way the company operates, so we think its going to be a really good fit.”

Miller said this is Tyler’s second-largest acquisition, with the largest being New World, a public safety-oriented technology business, which Tyler bought in late 2015 in a cash and stock deal worth about $670 million.