Node4 completes MBO backed by LDC
REGIONAL data centre and communications business Node4 has completed a management buyout backed by private equity house LDC.
Node4, which has turnover of £13m and is based in Derby with data centres in Leeds and Northampton, provides a wide range of data centre and managed IT services, including colocation, connectivity, managed hosting, communications hosted telephony, and a range of cloud services, to a UK-wide network of around 700 SME customers.
Established in 2004, Node4 employs more than 60 people.
The deal will provide further capital to help accelerate the continuing growth of Node4, primarily through continued new data centre development, whilst also allowing for the acquisition of complementary businesses operating in the data centre and cloud services markets.
The transaction also enables the other co-founding shareholders to fully exit the business.
LDC has backed Node4’s existing management team led by managing director and co-founder Andrew Gilbert, who will retain a significant shareholding.
The deal was led by LDC’s regional managing director Martin Draper, together with investment directors Andy Lyndon and James Robinson. Martin Draper will join the board with immediate effect.
As part of the transaction, the existing management team will be further supported by the appointment of David Goldie as non-executive chairman and Bernie Waldron as a non-executive director.
Previously chief executive of TalkTalk Group and chairman of Opel Telecom, Mr Goldie has a strong track record of working with fast growing entrepreneurial businesses and brings significant expertise in the wider managed hosting and IT services industry. Mr Waldron has held a number of senior positions at IBM across Europe and brings substantial mergers and acquisitions and IT services experience to the business.
Commenting on the investment, Martin Draper, of LDC said: “Node4 is a well-established market leading regional data centre services business, operating in a rapidly growing market that is being driven by a growing demand for hosted IT services by SMEs across the UK.
“We are partnering with a high-quality management team led by Andrew Gilbert, who has considerable knowledge and experience in the regional data centre services market having founded the business back in 2004. The company provides a high-end service to its regional customer base, and is supported by a well invested infrastructure. Going forward, we will work closely with the team to execute the next phase of the business’ growth and development.”
Mr Gilbert, said: “LDC’s investment and support brings additional strategic input and financial backing to our business and reflects the confidence both parties have in Node4’s future potential. Looking forward, we anticipate that LDC’s support will allow us to further strengthen our UK regional market leading position, invest for future growth both organically and through acquisitions, as well as continuing the provision of high quality data centre and cloud services for all our customers, existing and new.”
LDC completed the transaction with support from a number of Midlands-based advisors and funders, including KPMG, who provided financial and tax due diligence, and Browne Jacobson, who acted as legal adviser to LDC and Newco. The vendors were advised by PwC Corporate Finance and Pinsent Masons. The Structured Finance team at RBS Birmingham provided a package of senior debt plus growth capex facilities to support the buyout, and were advised by Eversheds.
