News
£30m merger creates next-generation cloud-centric managed services company
27 Jul 2020
Kerv, a next-generation ‘customer-first, cloud-first’ managed services provider has launched in the UK today, created to help mid-market customers achieve successful business outcomes in a new digital era.
Leading mid-market private equity house, LDC, has provided funding to enable the £30 million merger of three highly complementary, cloud-based managed services businesses to form Kerv: DoubleEdge Professional Services (UC, voice, data, mobility and compliance); Foehn (R&D team, Cloud UC and Contact Centre provider) and Metaphor IT (Cloud Services, Digital Workspaces, and IT Managed Services).
All three businesses are delivering double-digit growth rates in their own right and the new business will drive further organic growth, as well as identify further complementary acquisitions, supported by follow-on funding from LDC.
The group has been brought together by Alastair Mills, Six Degrees Group founder and former CEO, and also Mike Ing, former COO at Six Degrees Group.
Kerv comes to the market with current revenues approaching £20million and a team of 100 across offices in central London; Richmond, Greater London and Vigo, Spain. It will offer business outcome focused solutions, initially comprising of converged IT managed services, unified communications, contact centre, security and compliance applications, all delivered in a way that will set the industry benchmark for excellent customer experience.
The leadership team at Kerv will consist of Alastair Mills as Executive Chairman; Mike Ing, Managing Director and Andrew Marshall, group CFO. The management team of each of the three businesses all stay with Kerv and join the senior team.
Working in partnership with LDC to bring together these three businesses creates a strong foundation for growth. We plan to invest in great companies and accelerate organic growth through a relentless focus on customer experience. Our goal is not to chase short-term profit gains through aggressive cost cutting as we acquire complementary businesses."
“In a technology market that continues to consolidate rapidly through M&A, we feel now is the right time for a change in focus and culture. LDC’s investment in our business during this unprecedented period is testament to the strength of our proposition.”
Commenting on the impact of the current Coronavirus pandemic and the timing of the company launch, Mike Ing, Managing Director, Kerv adds: “Since we sketched out our CX-focussed investment plan towards the end of 2019, we’ve seen a dramatic shift to cloud-based remote working at an unprecedented scale. With the increasing availability of rapidly innovating cloud based applications, IT managed service providers should no longer need to be asset heavy, or rely on long term infrastructure investments, their job will to be integrate best of breed capabilities to deliver solutions for their customers.
“As a cloud-first, customer-first business we have the combined capabilities to help UK businesses navigate a new way of working as they adapt to an agile, technology-led environment post the pandemic.”
The transaction was led by Head of LDC in London Yann Souillard, Investment Director Aylesh Patel and Investment Manager Lewis Winston. Yann comments: “We’ve been working with Alastair and Mike for some time and we’re all equally excited about the growth potential of Kerv. The combination of customer-focused cloud-based solutions, along with Alastair and Mike’s track record and our approach to long-term partnership all stand the business in good stead to become a market leader.”
LDC’s investment in Kerv adds to the private equity firm’s successful track record of supporting the growth of tech businesses having invested more than £1bn in UK tech, media and telecoms companies. Just last week, LDC backed the management team of Aker Systems, following earlier investments in 3D software reseller Solid Solutions and digital marketing agency Croud.
LDC was advised by RSM (FDD), Armstrong (CDD) and DLA Piper (Legal).