
Equistone acquires WHP Telecoms in MBO from Palatine
Equistone Partners Europe has completed the management buyout of UK-based WHP Telecoms, a provider of services for the mobile telecoms infrastructure sector, from Palatine Private Equity.
The deal marks the third investment from Equistone's latest vehicle, the €2.8bn Equistone Partners Europe Fund VI, which held a final close earlier this month. It will take a majority stake in the business.
Meanwhile, Palatine achieved a 3x return on its initial investment and will co-invest for a minority stake alongside Equistone and the management team, which continues to be led by chief executive Rob Potter.
Equistone partner Steve O'Hare and investment directors Andi Tomkinson and Seb Leusch led the transaction. Tomkinson and Leusch will join the WHP board as non-executive directors.
Corporate finance adviser Clearwater advised WHP on its buyout from Palatine. RBS continues to provide banking facilities to the business.
Equistone held a first and final close for its sixth mid-market buyout vehicle, its largest to date at €2.8bn hard-cap, four months after launching fundraising efforts in November 2017. The fund is seeking to invest equity tickets of €25-150m in lower-mid-market companies with enterprise values typically between €50-€300m based in western European, especially France, Germany, Switzerland and the UK.
WHP is the third deal made via the fund already, following Boal and Small World, all inked in March.
Previous funding
Key Capital Partners (KCP) led a £3m investment in WHP Projects in June 2013. The fresh capital was used to support the rollout of the 4G network, consolidate estates and share masts to improve mobile phone coverage across the UK.
Palatine acquired the company from KCP for £38m in May 2015. The deal allowed KCP to reap a 4x return on its investment in WHP. Palatine parted with £16m in equity for a majority stake in the business. RBS provided a £16m debt facility to finance the transaction.
WHP acquired Paragon Telecoms in September 2015. Palatine sourced the bolt-on candidate and injected additional equity to finance the acquisition of Paragon. Palatine expected the bolt-on to enhance WHP's mobile network services and enable it to cater to a wider customer base.
Permira Debt Managers, via its Permira Credit Solutions II and III funds, provided debt for the refinancing of WHP Group in July 2017.
Company
Established in 1988 and headquartered in Warrington, Cheshire, WHP provides deployment, upgrade and maintenance services for mobile network masts, antennae and base stations. Its clients include H3G, EE and Vodafone. The company has additional bases in Leeds, Glasgow, Birmingham and Heathrow, and employs a staff of 440.
WHP is forecasting a turnover of nearly £75m for its current financial year to May 2018, up from revenues of £30m in 2015.
People
Equistone – Andi Tomkinson (investment director).
Palatine Private Equity – Andy Lees (partner).
WHP Telecoms – Rob Potter (CEO).
Advisers
Company – Clearwater International, Michael Reeves, Michael Loudon, Lachlan Dorrity, Mark Maunsell (corporate finance); Mark Taylor, Tom Barnwell, Mark Ward (debt advisory); BDO, Chris Heatlie (financial due diligence); Analysys Mason, Charles Murray (commercial due diligence).
Acquirer – Addleshaw Goddard, Paul Medlicott, Jemma Clarke (legal); PwC, Nick Hatton, Seema Ahmedabadi (tax).
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