Dunedin backs £43m Trustmarque secondary buyout

Amy King
10 June 2013

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Mid-market GP Dunedin has backed the ТЃ43m management buyout of Trustmarque Solutions, a technology services and solutions provider, from LDC.

Dunedin Enterprise Investment Trust plc contributed £3.7m to the deal.

Dunedin was drawn to the company as the UK market for IT services and software is predicted to grow at 2-5% per annum to 2016, the GP said in a statement. it now intends to grow Trustmarque's service offering and customer base.

Previous funding
LDC acquired a significant minority stake in Trustmarque in 2006 in a secondary buyout from Royal Bank Equity Finance.

The transaction valued the firm at £30m and saw LDC inject £10m into the firm, supported by senior debt and working capital provided by Royal Bank of Scotland Corporate and Structured Finance.

The company was bought at an auction run by McInnes Corporate Finance and saw significant interest from trade players.

In 2011, Trustmarque acquired Nimbus Technology Systems to extend its cloud computing service range.

Company
Founded more than 25 years ago and based in York, Trustmarque provides technology services and solutions to private and public sector organisations in the UK. The firm enables organisations to license, deploy and manage technology solutions from a range of developers.

The firm recorded revenues in excess of £130m for the year ending 31 August 2012. At the time of LDC's buyout in 2006, the company reported a £121m turnover.

Trustmarque employs 180 staff across three sites in York, Bracknell and Edinburgh, and counts more than 1,200 clients including RBS, Lloyds Banking Group and Sainsbury's.

Public sector clients include the NHS, the Ministry of Defence and HMRC.

People
Mark Ligertwood is a partner at Dunedin and worked on the transaction alongside Dougal Bennett, Jon Ma and Jamie Moodie. Steve Harrison is a director at LDC.

Advisers
Equity – BDO (Corporate finance); Armstrong (Commercial due diligence); OC&C (Commercial due diligence); Pinsent Masons (Legal); KPMG (Tax); Intuitus (IT due diligence).
Vendor – Sentio Partners (Corporate finance); Squire Sanders (Legal).