2e2
We got to know the management team at 2e2 well before we bought the business and this allowed us to avoid a competitive auction. We have already made one significant acquisition and have identified other suitable targets.
High growth
2e2 is an IT service provider offering consultancy, implementation and day-to-day management services across a broad range of IT. The company operates in mainland UK, the Channel Islands, Isle of Man and the Netherlands.
The company has a strong position in high-growth sectors and is well placed for organic growth. We acquired 2e2 in September 2006 for £130 million.
Stable income
Having identified 2e2 as an attractive potential secondary buyout we reached agreement on a deal with the company’s CEO, then jointly approached owners Gresham Private Equity. We were able to avoid an auction and acquire the company in a bilateral deal.
2e2 has leading and defensible positions in high-growth sectors, with some of its key markets growing at double digit rates. Alongside that, 2e2 enjoys a high proportion of stable, contracted income. The company also has strong relationships with key partners such as Cisco, Microsoft, HP and Oracle.
We backed the existing management team, which had an excellent track record of growing the business organically and through acquisitions. The team re-invested a significant portion of their proceeds into the new deal.
There is considerable scope to continue to grow the business organically. We are also looking at further acquisitions.
Working to become the UK’s top provider
In April 2007 2e2 acquired Compel plc in a £53 million recommended deal, increasing both the scale and value of the business significantly. As well as adding around £100 million revenue, it boosted 2e2’s presence in the security and storage arena. Additionally, the company got involved in business consulting for the first time, with the UK’s largest independent Oracle consultancy.
While substantial cost savings have already been made, further savings are expected from the major integration programme that is currently underway. The programme will also lead to operational improvements that will help the business compete for larger, more complex projects.
The enlarged business is now close to its goal of becoming the UK’s leading independent provider of network-based IT services. It is in a strong position to enjoy continued organic growth.