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The deal, expected to value the combined entity at over £1 billion, could be announced as soon as this week
Matthew Riley, the CEO behind Daisy Group – one of the UK’s largest privately-held IT services companies – is close to securing a merger with Wavenet, a UK based communication and technology solutions provider, according to a report from Sky News.
Anonymous sources say the merger would see Daisy’s Corporate Service Business carved out and absorbed into Wavenet, which is majority owned by Australian financial services group Macquarie.
The resulting combined entity, which would still be known as Wavenet, would have an enterprise value of over £1 billion.
The newly merged Wavenet will employ more than 2,000 people under the leadership of executive chairman Bill Dawson with Riley joining the company’s board as a non-executive director. It will serve over 20,000 enterprise customers across the UK including the NHS and Transport for London.
“This deal brings together two prolific consolidators, making Wavenet the largest independent Managed Service & Security Provider for large SME & corporate customers,” Wavenet CEO Philip Grannum told Sky News.
“It provides both Daisy and Wavenet customers greater access to enterprise grade solutions combined with the very best customer service and gives fantastic career opportunities for our employees.”
It’s understood that Macquarie will retain its position as the largest individual stakeholder in the new Wavenet, with additional support from debt financing provided by Ares.
Daisy has been on something of a dealmaking spree recently, having last month closed a deal to acquire 4Com, a Bournemouth– based communications, IT, and broadband provider for £215 million.
Riley was reportedly attracted to 4Com because of its cloud communications product HiHi, a business phone with in-built video calling technology, and its accompanying software platform.
In fact, Daisy’s expansion in recent years has cemented its position as the second-largest player in the UK’s SME telecommunications market, behind only BT.
Formerly listed on the London Stock Exchange, Daisy transitioned to private ownership in 2014 with backing from Toscafund Asset Management.
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