PureCloud
- Sector
- Telco & IT Managed Services
- Size
- £0.5m EBITDA
- Advisory
- Sell-Side
Background
- Founded by two brothers, Darren & Martin, PureCloud operated initially as a carrier class comms provider to SME & public sector businesses in the Midlands.
- In the 15 years since founding the business developed to add IT to its service estate and grew some compelling customer relationships.
- Independence had made contact with the vendors direct as part of the origination for our two MSP assets and at the time the family were not keen to sell immediately but were more interested to retain Independence as their advisors to appraise what options the business had and support the family through medium-range planning for succession, now that Darren’s son Jamie was leading the business day-to-day.
Process & outcome
- We undertook a detailed Options review – including mapping what would be possible in so far as partial cash-out and buy-side support, management buyout / EOT and full external marketing. After careful consideration the family chose being fully marketed.
- The marketing process was built first after creating a comprehensive suite of collateral to articulate and present the value proposition and opportunity ahead.
- The vendors received over 30 requests for information and subsequently 7 fully formed offers, which Independence helped to further develop with a priority cohort of three buyers. One of those was YourCloud – the European MSP consolidator, whose Buy-Hold model meant that the business would continue with its name and team intact but allow for the founding shareholders to cash-out in full, leaving the son (MD, Jamie Lake) the scope to develop the business whilst participating in future value.
- Whilst YourCloud – backed by a Dutch billionaire family office – have concluded over 30 M&A deals, this was just their third in the UK and Independence – in part through their extensive knowledge of the market having invested in two MSPs were able to build trust & rapport despite there being some idiosyncrasies with how they transact.
- During the engagement, a series of exceptional customer losses caused the last two years Revenue to show c30% reduction. Despite this being a negative outlier in a growing market, we were able to negotiate a price which our records show is the highest multiple for a business of that profile on record.
- Acquisition by the group has proven successful, with YourCloud continuing to grow operations in the UK and invest in PureCloud both in terms of recruitment, operations and finding bolt-on acquisitions to accelerate their development.
“I couldn’t recommend Independence highly enough. They introduced us to YourCloud who have been a tremendous buyer – enabling my son to continue our legacy and for the company to be a formative part of YourCloud’s journey into the UK. The deal process was not straightforward but with Independence support we felt we could overcome any challenge and having them fight our corner quite probably made the difference between deal or no deal.”
