Mayfair acquires BGF-backed GCI

The deal is an exit for BGF after a six-year holding period, and also sees GCI chairperson Wayne Martin sell the majority of his shares.

Financial details of the transaction remain undisclosed, though Unquote sister publication Mergermarket recently reported that the vendors were aiming for an enterprise value of around £200m. The publication also reported that LDC and Virgin Media were involved in the bidding process.

Unquote understands the target figure of £200m reported by Mergermarket was close to the final deal value.

As part of the deal, Mayfair has invested equity towards a £60m acquisition finance fund for the firm. The business will also rebrand a number of its divisions under the GCI name in the coming months.

GCI has undertaken an acquisitive growth strategy since BGF's initial backing, acquiring Packet Media, Fusion Media Networks, Outsourcery, Freedom Communications, and Blue Chip Data Systems over the course of the last two years.

The business generates a turnover of around £100m, according to a statement, up from £65m at the time of the vendor's initial investment. Its headcount has also increased from 220 to 500 during that period.

Mayfair is currently in the process of raising its second fund with a target of £600m and a co-investment vehicle, Mayfair Equity Partners II Sidecar, with a £200m target. The GP's maiden vehicle was 70% deployed as of January 2018, according to Unquote Data.

Previous funding
BGF invested £10m in GCI in February 2012 in return for a minority stake.

Company
Founded in 2000 and headquartered in Lincoln, GCI provides inbound and outbound telephony and data services to medium-sized corporations and smaller enterprises. The company has its own fibre-optic communications network and data centres, and offers outsourced cloud solutions for IT communications.

According to the report by Mergermarket, GCI generated pro-forma EBITDA of £19m in 2017.

People
Mayfair Equity Partners – Waqqas Ahmad (partner).
BGF – Gurinder Sunner (investor).
GCI Managed Services – Adrian Thirkill (CEO); Mark Allen (chief financial officer).

Advisers
Equity – Investec (corporate finance).
Company – KPMG (corporate finance).

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• Topics
• Buyouts
• Exits
• UK / Ireland
• Technology
• United Kingdom
• Mayfair Equity Partners
• BGF (Business Growth Fund)
• Secondary buyout
• Investec
• KPMG