Bowmark Capital, a mid-market private equity firm, is backing the buy-out of IT solutions provider Node4 Holdings from its previous institutional investor, LDC.
Founded in Derby in 2004 by its then 23 year old chief executive Andrew Gilbert, Node4 is a provider of integrated IT solutions, hybrid infrastructure and cloud-enabled managed services to small and medium-sized businesses.
With full ownership of its own infrastructure, including three state-of-the-art data centres in Derby, Leeds and Northampton, Node4 retains full control over service delivery.
The company achieved a GBP28 million turnover in the year to March 2016 and a revenue growth rate of 37 per cent per annum since 2014, capitalising on the growing trend towards the outsourcing of information and communications technology (ICT) services.
Digitalisation and the increased use of cloud-enabled applications, together with the increasing complexity of hybrid cloud solutions, represents an opportunity for the company to build on and expand its client base.
Bowmark has acquired a majority shareholding in the company alongside the current management team. The transaction funding includes an additional GBP40 million made available (in follow-on debt and equity funding) to underpin the company’s ongoing acquisition strategy, which has already seen three bolt-on acquisitions in the past two years.
Bowmark investment director Stephen Delaney says: “We have been tracking the ICT managed services sector for a number of years and are delighted to have the opportunity to invest in the standout company in the sector. We have been hugely impressed with Andrew Gilbert and his team and what they have achieved to date.”
Gilbert says: “Our well-invested infrastructure and technical base provide us with a highly scalable platform. With Bowmark’s support, and the additional firepower that this transaction gives us, we are well-placed to capitalise on the significant growth opportunity, both organically and by acquisition.”
Martin Draper, chief executive of LDC, says: “The company’s success demonstrates the impact private equity investment can have as a catalyst to build scale and value, and to support the vision of ambitious management teams. Our close partnership with Andrew and the team has helped the business to more than double its revenues and triple its employee numbers.”