Unified comms provider Daisy Group has acquired SpiriTel for £37m, cutting its biggest deal to date.
Under the transaction, Daisy inherits a £30m plus turnover business, along with SpiriTel's 200 staff in London, Cardiff, Wigan and Glasgow - as well as more than 4,000 corporate customers including RBS, Barclays, BBC Worldwide, Marriott, HMV, City of London and Punch Taverns.
SpiriTel has grown rapidly since it was set up in 2006. Its aggressive 'buy and build' strategy, led by CEO Alastair Mills, delivered 12 acquisitions in quick succession and a strong organic growth rate of 15%, resulting in a £30m plus turnover business.
As part of the deal, Mills and CFO Ronnie Smith will leave the business, after a short handover period, to focus on other business ventures.
The acquisition delivers a healthy profit for private equity group Penta Capital, the majority owner of SpiriTel. The deal values the business at £37m. SpiriTel shareholders will receive around £27m with the balance being outstanding bank debt and earn-out payments that will become payable by Daisy.
SpiriTel was advised on the transaction by Hammonds, finnCap and Knight Corporate Finance.
Mills said: 'It has been a real privilege to lead SpiriTel through a period of transformation and establish the company as one of the fastest growing providers of integration communications to UK business customers. SpiriTel’s highly talented management team has executed a comprehensive turnaround strategy to the point where we have now sold a business of genuine scale that competes for and wins major contracts from major businesses.'
Steven Scott, partner at Penta Capital, added: 'The sale to Daisy marks another successful exit for our investors. This was a difficult investment in the early years, which the current management team completely transformed, with our support, into a dynamic growth capital buy and build group in a rapidly consolidating sector.
'Twelve acquisitions were integrated quickly and efficiently on a relatively ungeared basis and, despite the economic uncertainty, the team successfully delivered organic growth alongside the acquisitions.
'I am sure that the SpiriTel team and customers will prove an excellent addition for Daisy Group and we wish them all well. We would like in particular to thank the board of SpiriTel for their hard work and focus over a prolonged period, delivering value in a difficult economic climate. We have very much enjoyed working with them and have appreciated their patience and long-term approach to shareholder value.'
Adam Zoldan, director at Knight CF, said: 'Alastair and his team have demonstrated how a well managed series of acquisitions can deliver a spectacular return for investors. The deal is also indicative of the continued buoyancy of the sector and we expect more buyers to seek acquisitions with an increasing number supported by funding from the private equity sector. As a result we look forward to assisting more companies to realise value as the M&A consolidation continues throughout 2011.'