Board changes with deal
LDC confirms investment in telecoms group Commsworld
Ricky Nicol: ‘insatiable demand’; (pic: Terry Murden)
Private equity house LDC, part of Lloyds Banking Group, has confirmed a “major investment” in Commsworld, the Edinburgh-headquartered telecommunications and ISP provider.
Terms of the deal, predicted earlier this week, were undisclosed but LDC will take a minority stake, contrary to speculation that it was acquiring the whole business.
The investment will help the existing management team to build on the success of the business in recent years and bring its connectivity to more organisations across Scotland and the UK.
LDC’s Mark Kerr and Colin Bennett will join the board of Commsworld, alongside CEO Ricky Nicol, CFO Graeme St John and non-executive director Steve Langmead.
Telecoms expert John Trower is also joining as chairman. He has significant experience of working for and advising private equity backed telecoms businesses and has held board roles at Metronet UK and Glasgow-based My1Login. The deal provides an exit for the remaining non-executive directors and private shareholders. These include the SNP’s Westminster leader Ian Blackford.
Commsworld provides connectivity, cloud, security, unified comms, and IT infrastructure services to the public and private sectors. Key client relationships include Taylor Wimpey, Skyscanner and Edinburgh Airport.
Established in 1994, it has 110 staff based across its offices in Edinburgh, Glasgow, London and Aberdeen. For the year ending December 2018, it recorded revenues of £20m – a 41% increase on the previous 12 months.
The business has developed its own carrier-grade network over the last few years with UK and international reach.
Mr Kerr, head of LDC in Scotland, said: “Ricky and the team have transformed Commsworld in recent years from a telco reseller into a stand-out national network operator. Our investment will help them to build on this hard work and success and deliver further on their ambitions for Commsworld.”
Mr Nicol said: “There is an insatiable demand for robust, flexible reliable and scalable telecommunications networks as businesses keep up with rocketing data usage. We have created a network that more than meets those challenges and has already had an incredible impact on connection quality.
“We had the choice of a number of options for investment, but we have built a strong relationship with LDC who share our vision for the business and can provide the right balance of support, experience and contacts to help us deliver.
“LDC’s investment is a real signal of our intent to further invest in our offering and capacity so we can continue to disrupt the market. Rest assured, we’ll be targeting another year of double-digit growth.”
LDC was advised on the transaction by a team from the Edinburgh offices of EY (corporate finance and debt advisory) and Pinsent Masons (legal). The Commsworld management team was advised by Oakley Advisory and the management shareholders by Addleshaw Goddard.