Core Capital sells Kelway

Ellie Pullen
07 November 2014

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Core Capital Partners has sold its 29% stake in Kelway, a UK-based IT services provider, to US IT company CDW for ТЃ76m.

CDW has backed the management buyout of Kelway, acquiring a 35% stake in the business. Founder and CEO Phil Doye and managing director Dan Laws have remained as the company's majority shareholders. Barclays and HSBC supported the transaction.

Under Core's ownership, Kelway executed seven bolt-ons, including the acquisitions of Repton in 2009 and Equanet from Dixons Group.

Nasdaq-listed CDW is a provider of IT services in the US and Canada. The company was founded in 1984 and generated revenues of $10.8bn in 2013. It employs 7,100 staff.

Previous investment
Core first invested in Kelway in December 2006, acquiring a 25% stake for £5m, giving the business an enterprise value of £20m. The firm invested via its Core VCT II and III vehicles.

Company
Founded in 1990, Kelway is headquartered in London with additional UK offices in Basingstoke, Peterborough and Manchester, as well as bases in Dublin, Dubai, Singapore and Cape Town.

The company is a provider of IT services and products, such as data management, security and infrastructure. It generated £530m in revenues in 2013. At the time of Core's investment in 2006, the company recorded just £45m in turnover. It aims to reach £1bn in turnover within the next three years.

People
Walid Fakhry is a managing partner at Core. Thomas Richards is the CEO and chairman of CDW.

Advisers
Company – William Blair (Corporate finance); Reed Smith (Legal).