UK telco Daisy swallows up troubled Alternative Networks

UK unified communications provider Daisy has seemingly capitalized on financial woes of competitor Alternative Networks, snapping up the business for a cool £165 million.

Both companies owe expansion in recent years in part to an aggressive acquisition campaign, which has seen the competitors going head-to-head in the bidding process, tucking smaller companies under their respective brands. Daisy has come out on top buying its rival as Alternative Networks has been hit hard following changes to data roaming by the European Commission.

Share prices in Alternative Networks dropped to £2.7 last week, after hitting highs of just over £5 in January, as the team put out three profit warnings in the last 12 months. The price offered to investors is a 17% premium to the closing price of £2.85 per Alternative Networks share on 18 November.

“This announcement builds upon Daisy’s successful acquisition strategy, to enable our customers to take advantage of digital technology in a converging world of business communications and IT,” said Neil Muller, CEO of Daisy.

“Alternative Networks is one of the largest independent providers of IT managed services and business-to-business communications in the UK and represents a strong and complementary strategic fit with the Daisy Group’s existing business and operations. Having respected Alternative Networks for many years, we look forward to further enhancing our capability and scale across our chosen markets and we believe the combined group will be well positioned to increase its market share further and to continue to be the provider of choice for its customers and partners.”

The acquisition will build upon Daisy’s recent acquisitions of Damovo and Phoenix IT in the managed services segment and will further broaden and strengthen its mobile and fixed line product and service offerings. The team has set its ambitions on being £1 billion revenue unified comms & IT infrastructure managed services business in the mid-term future.

The deal will be the 50th made by Daisy, led by former Sir Philip Green whiz kid Matthew Riley, and will increase the turnover of the company by roughly 25%. The growth by acquisition strategy employed by Riley is partially built on the cost saving achieved by relocating all staff and operations to the Lancashire headquarters following any purchases.

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