Technical Due Diligence for Metronet (UK) on its £47.5m acquisition of M247

Background

Clevercoms carried out Technical Due Diligence on Metronet (UK)’s £47.5m acquisition of M24Seven, a leading internet infrastructure and hosting company.  Metronet (UK) is the country’s fastest growing network services provider and is backed by mid-market private equity firm Livingbridge.

Livingbridge invested in Metronet (UK) in June 2014 as part of a £45m secondary buyout.  Metronet (UK)’s acquisition of M24Seven is the first step in a targeted buy and build strategy that aims to build a disruptive platform in the connectivity space with ‘last mile’ control, speeding up communications to end users, and a powerful transit network across Europe. Following the acquisition, the combined business will have EBITDA in excess of £12m, over 200 staff and three datacentres across the UK and Europe.

The Brief

To provide a technical appraisal of three data centre facilities in UK and Europe and report any critical issues and potential risks to the value of the acquisition target. A review of the network including opportunities for synergies was also required. The findings to be presented in a report, including an initial high level “red flag” summary for both the company and the investors.

Clevercoms approach

Clevercoms provided a technical appraisal of the three data centre facilities and the Circuit and POP review within the requested timeline.

Assessments of both the physically facilities and their associated operations and maintenance information were provided. This included assessments of data centre resilience, capacity and utilisation, knowledge of key personnel, as well as leasehold and freehold arrangements.   A review of IT operations and tools was also carried out.

A technical due diligence report was submitted which included an early stage synergy assessment and a “red flag” summary for the Company and investors.

“Finding advisers with a comprehensive knowledge of the sector with flexibility and the ability to adhere to our tight timetable was critical.  Clevercoms fitted the bill perfectly.”

Andrew Goldwater, Chief Operating Officer, Metronet (UK) Ltd (now M24Seven)