IT Managed Services Provider for Sale

• Highly successful provider of fully managed IT support and hosted / cloud services.

• Based in London with an overseas office and support desk; the company has global clients across the UK, Europe, Africa, Asia and the US.

• A well-defined brand offering a comprehensive range of IT services, primarily for small and medium sized businesses.

• Over 120 servers and 700 PCs/MACs supported by the company across its client base.

• The average size of client serviced by the company is 45-50 users and 6 servers.

• A loyal client base which is well spread both geographically and across industry sector including companies in design & creative, finance, professional services, IT and construction.

• A significant proportion of the company’s 40+ customers are on 3-year managed services contracts with auto-renew terms and are predominantly paying monthly in advance.

• Approximately 65% of turnover is contracted recurring revenue. The rest is hardware/software sales.

• The largest client represents 39% of the total revenue and has been a customer of the company for over 13 years; no other client represents more than 10%.

• Over 20% of the clients have been using the company’s services for between 10 and 18 years.

• Turnover to July ‘16 was £1.33m with an adjusted EBITDA of £434k (33%). Projected turnover for the year to July ‘17 is £1.53m.

• A second-tier management team is accountable for running the business day to day.

• The sale of the business offers an outstanding opportunity for another IT support, hosted services, technology or telecoms company looking for a strategic acquisition to add to their portfolio.

• There would be significant opportunities for any UK-based acquirer to realise significant cost savings by migrating more IT support desk and back office work to the overseas office.

Products and Services

• Fully-integrated, comprehensive managed IT services
• Fully bespoke Hosted Cloud Services
• Consultancy Services
• Re-Sale of products and services

Employees

• 2 Directors (vendors) plus a highly capable team of full/part-time staff.
• The technical side of the business is managed by the Technical Services Manager and Service Delivery Manager.
• There is a full-time Finance Manager, Procurement Administrator and Marketing Manager

Premises

• The Head Office in central London is provided by one of the company’s long-term clients - there are no contractual obligations, rent or rates payable.
• The overseas office is rented on a three-month rolling contract basis, at a rent of £1000/month including utilities & connectivity.

Reason for sale

• The vendors feel that they have taken the business as far as they can and have established a solid platform for growth. Their expectation is to probably exit the business following an agreed handover to pursue other non-competing interests, but both would be open to remaining with the business for the medium term if this suited the acquirer.

Financial overview

Adjusted EBITDA is stated having accounted for market remuneration of the vendors’ roles in the business.

SOLD