Times Colonist

Victoria software company bought

Terms of sale not released


A software company founded 25 years ago in Victoria by a former employee of the Capital Regional District to take the paperwork out of everyday civic planning and permits is being sold to Toronto-based Constellat­ion Software Inc.

Municipal Solutions Group, which trades on the TSX Venture Stock Exchange with a market capitaliza­tion of $1.2 million, makes packaged software to help municipali­ties manage permits, inspection­s, planning, zoning, code inspection­s and other services.

Terms of yesterday’s agreement for sale were not disclosed but Constellat­ion said it will acquire most of Municipal’s product lineup, excluding a local government manager line.

The company did not say if Municipal — headquarte­red in Saanich at the Vancouver Island Technology Park — will continue to operate and there was no immediate local comment yesterday. More than 140 cities across North America use its software products.

In a release, Constellat­ion said Municipal’s biggest shareholde­r, with a 52 per cent stake, has agreed to vote for the deal, expected to close in July.

The takeover is the fifth acquisitio­n this year by Constellat­ion (TSX:CSU). The company is making the deal through its wholly owned subsidiary, N. Harris Computer Corporatio­n, for the assets of Municipal Solutions Group (TSXV:MSZ) and the shares of its wholly owned operating subsidiary, Municipal Software Corp.

The basis for Municipal was founded in 1986 by Victorian Rob Bennett when he was a computer programmer for the CRD and earning a computer science degree on the side. He and a partner started New Era Software a short time later, based on some of the work they did at the CRD. Bennett got early financial backing from then-Saanich Mayor Mel Couvelier and his son, Rod Couvelier, who took key roles in the company.

Bennett would take the company public and later engineer a reverse takeover to refinance the firm. But Municipal struggled, showing a $2.3-million loss in 2004 and $2.8 million in red ink in 2005.

Last June 15, Bennett resigned in sweeping restructur­ing to reduce operating costs at Municipal, which also saw Couvelier, the former provincial finance minister, step down as chairman and director of the company.

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