Equistone and LDC back MDNX deal

Alice Murray
12 December 2013

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Hosting provider MDNX has acquired Easynet with backing from Equistone Partners Europe and LDC, providing an exit for Kelso Place Asset Management.

Equistone secured a majority stake in the newly formed group. Easynet was purchased from LDC; however, the captive reinvested in the new group to acquire a minority stake alongside MDNX. Furthermore, the deal allowed Kelso Place to fully exit its holding in MDNX.

Easynet's German operations were not included in the deal and instead have been made independent. LDC remains invested in the German business, which will be renamed Nexinto in 2014.

Due to the separation of Easynet's German business, the enlarged group will create a new company in Germany, which will be called Easynet Global Service and will partner with Nexinto in global network business.

Previous funding
LDC acquired Easynet for £100m from BskyB in July 2010.

Kelso Place purchased MDNX in October 2010 through the merger of Solution1, VTL and CIG. In August 2012, Kelso Place supported the company's acquisition of UK-based IT services provider Octium.

Company
The enlarged group offers managed networking, managed hosting and cloud infrastructure services, unified communication services, application performance management and security services.

MDNX is a UK-based integrator providing managed networks to UK businesses and local governments. It services more than 3,000 customers and works with more than 600 channel partners. The company operates through six high-security data centres, and is headquartered in Bracknell.

Easynet is a managed cloud infrastructure provider. Customers include EDF, Sage, Yakult and Transport for London. Furthermore, the company is part of the UK government's G-Cloud procurement framework.

People
Mark Thompson, CEO of MDNX, will lead the new group. Wayne Chruchill is COO and Mike Mulford is CFO. Easynet's CEO, Greg Clarke, will take up the role of non-executive chairman. Rob Myers is managing director of Equistone.

Advisers
Equity – Marlborough Partners (Debt advisory); Travers Smith (Legal); Oakley Capital (Corporate finance); CIL (Commercial due diligence); Intuitus (IT due diligence); Deloitte (Financial due diligence); KPMG (Financial due diligence).
Management – Proskauer Rose (Legal); Grant Thornton (Tax).