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FINEOS raises Euro 10 million in first-round fundraising with ABN AMRO Capital

Fast-growing profitable Irish software company secures equity investment and creates 100 new jobs

January 4, 2002 - Dublin - FINEOS, a leading global provider of enterprise customer and contract management solutions for banking and insurance, today announced that it has secured an equity investment of Euro 10 million. The financing was led by ABN AMRO Capital in Holland and the other investors included Enterprise Ireland, the Allied Irish Bank (AIB) IT Fund, and FINEOS directors and employees. This is the first round of funding undertaken by the company since it was established in 1993. Goodbody Corporate Finance has served as financial advisors for this investment round.

FINEOS intends to use the fundraising to strengthen the company at all levels and to accelerate its expansion in Europe and the US. The investment will help FINEOS to strengthen its direct and in-direct sales force as well as to expand its R&D capability in Dublin. The company employs 250 people with almost 210 based in its Dublin headquarters, and expects to create up to 100 new jobs over the next 12 to 15 months.

FINEOS is profitable and has achieved continued year-on-year growth in revenues, customer numbers and staff, and over the last four years these have exceeded 100% per annum. During 2001 FINEOS opened sales offices in the US and Scandinavia to extend its market reach. In each of these regions FINEOS will announce major sales in the coming weeks, to both a leading US insurance provider and a Scandinavian financial institution.

Commenting on the announcement, Nicolaas Heij, Senior Vice President of ABN AMRO Capital, said: "We are delighted to announce this equity investment in FINEOS. It is ABN AMRO Capital's first investment in an Irish software company, and with the company's strong track record of revenue and profits growth, allied to a strong portfolio of products and referenceable blue-chip customers, we feel FINEOS offers tremendous potential. This capital investment will allow the company to realise this potential through further expansion in terms of people, products and markets."

Michael Kelly, CEO of FINEOS, said: "This investment is a strong endorsement of the business philosophy that we have adopted from day one, which is the commitment to deliver real profits and strong products. Our products are modern, flexible enterprise-wide solutions that deliver cost savings and revenue increasing capability to banks and insurance companies. In order to further strengthen our product suite, FINEOS will continue to recruit and develop high quality staff and this commitment from ABN AMRO Capital, Enterprise Ireland and AIB will help to propel FINEOS to the pinnacle of the financial services software market."

According to Patricia McLister of International Services, Enterprise Ireland: "Investment in research and development is a key component in the continued success of FINEOS in global markets. Enterprise Ireland is pleased to be a partner in this new investment which will underpin the company's growth strategy into the future."

Adding to this, John Nolan of the AIB IT Fund commented: "We are delighted with the opportunity to invest in one of Ireland's leading providers of financial services software and to assist in accelerating the expansion of FINEOS's global business operation."

Mark O'Donovan of Goodbody Corporate Finance also said: "We are very pleased to have worked with FINEOS in securing this investment which will allow them to grow rapidly and to take advantage of the massive global and European market opportunity in banking and insurance software."

The fundraising announcement marks the end of an impressive year for FINEOS. Over the last 12 months the company has secured a string of contract wins, including ABN AMRO Insurance, First National Bank and Eagle Star. Earlier in the year, Britannia, FINEOS's first CRM customer, scooped the award for "Most Innovative use of CRM Technology" within the UK financial services industry and is ranked by independent auditors QCi as being in the Top 5% of its worldwide CRM table. Most recently, Michael Kelly, CEO of FINEOS, was selected as Ireland's Ernst & Young Technology Entrepreneur of the Year 2001.

FINEOS also added significant names to its board last year. It appointed former AIB chief executive and Aer Lingus chairman Tom Mulcahy as its chairman. Mulcahy was appointed because of his wealth of experience in financial services, both in Ireland and internationally. The Mulcahy appointment followed shortly after international financier James McNaught-Davis joined the board as a non-executive director from leading international private equity and venture capital firm Warburg Pincus, where he was managing director.