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Sage Mulls Sale Of North American Payments Unit

Tom Jowitt is a leading British tech freelance and long standing contributor to TechWeek Europe

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British software giant examines ‘strategic options’ for American payments business

British accountancy giant Sage is reportedly examining the sale of its North American payments business.

Sage of course is based in Newcastle and is one of the last remaining independent British software giants. It made its name in accounting and payroll programs but it is facing increased competition from web-based alternatives.

And now the FT has reported the firm as saying on Wednesday that it is “evaluating potential strategic options for its North American payments business, including a sale”.

Tyne Bridge NewcastleStrategic Options

The firm did however tell the newspaper that there is “no certainty that this evaluation will lead to any transaction.”

Silicon UK has contacted Sage at the time of writing, but has yet to receive a response.

Sage’s traditional approach of selling software that is installed on local machines has come under pressure in recent years as more and more firms transition to cloud-based operating models. And to make matters worse, more firms are offering web or cloud-based accountancy alternatives.

Sage has responded by trying to encourage its customers to move over to a subscription-based service, and according to its latest financial results, the Geordie firm is seeing some traction as faster-growing subscription revenues reportedly continued to offset a decline in its traditional software sales.

But it seems that Sage’s payments business in North America has been underperforming for a while now compared to the overall performance of the parent firm.

Security Scares

And Sage is not only having to contend with increasing competition. It also recently had to contend with an internal security issue.

In August Sage admitted that that it was investigating a case of “unauthorised access” to customer data. It said that personal information relating to employees at 280 UK businesses that are customers of Sage had been accessed.

It is thought that the information included employee bank account details and salary information. The data had been accessed by someone using an “internal” login.

Just days later City of London police confirmed that an employee of Sage had been arrested at Heathrow airport.

Quiz: Can you protect your privacy online?