By Milana Vinn

Copyright reuters

SummaryCompaniesGoldman Sachs advising on potential sale or IPO in next 12 monthsDeal would result in substantial profits for MRI’s private equity backersCompany maintains 10% annual growth rate, over half of revenue from outside US

Sept 26 (Reuters) – The private equity owners of real estate software provider MRI Software are exploring options for the company, including a potential sale or a public listing on a U.S. exchange, according to people familiar with the matter.

Any deal for MRI Software, which could happen within the next 12 months, is expected to value the software maker at up to $10 billion including debt, the sources said, requesting anonymity as the discussions are confidential.

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The ownership consortium includes TA Associates, Harvest Partners and GI Partners. It is working with Goldman Sachs (GS.N), opens new tab on the process, which was kicked off by inbound acquisition interest from other real estate and technology firms, the sources added.

Spokespeople for MRI Software, TA Associates, GI Partners and Goldman declined to comment. Harvest Partners did not respond to a comment request.

Headquartered in Solon, Ohio, MRI provides software for the real estate industry that helps property owners, investors, and managers oversee commercial and residential portfolios. Among the software tools are those handling accounting, leasing, and financial management.

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MRI Software is approaching $1 billion in annual revenue and generates approximately $400 million in earnings before interest, taxes, depreciation, and amortization (EBITDA), according to the sources. The company has maintained a steady annual growth rate of 10%, with more than half of its revenue generated outside the U.S., the sources said.

A sale or listing at the purported valuation would represent a major exit for MRI Software’s private equity backers. GI Partners, which invested in the company in 2015, is on track to return nine times their initial equity investment, while TA Associates, the largest holder of MRI, is projected to make seven times its money, the sources said.

Application software firms, including those in real estate, have recently seen a pickup in M&A, with private equity buyers paying attractive prices thanks to the steady recurring revenue these businesses generate.

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Last month, Reuters reported that Altus Group (AIF.TO), opens new tab, a Canadian software and data analytics provider focused on the real estate industry, is exploring a potential sale after receiving inbound acquisition interest.

Reporting by Milana Vinn in New York; Editing by David French and David Gregorio

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Milana VinnThomson ReutersMilana Vinn reports on technology, media, and telecom (TMT) mergers and acquisitions. Her content usually appears in the markets and deals sections of the website. Milana previously worked at GLG and PE Hub, where she spent several years covering TMT deals in private equity. She graduated from CUNY Graduate School of Journalism with Masters in Business Journalism. EmailXLinkedin