2e2 rolls up Netstore for UK channel glory
2e2, the private-equity backed reseller group, is buying Netstore for £57m in cash.
The deal appears to be more about scale than heavy cost-cutting - 2e2 says customer overlap with AIM-quoted Netstore is limited. To 2e2, bigger means better customer retention, and easier-to-find and keep good staff.
And of course, it brings nearer the day when the company is big enough to talk up a good IPO. Right now, 2e2 has 1400 staff in the UK and the Netherlands and claims annual run-rate revs of £240m. Perhaps its best-known acquisition to date, certainly in the UK, is Compel, bought for £53m last year.
Netstore describes itself as a managed services provider. It runs four data centres for mid-market customers, and it also has security and consulting divisions.
In the latest interims, the company made a net loss of £266,000 on revenues of £19.6m. Set up in 1996, Netestore has bought up five resellers along the way, so it's no stranger to roll-ups - if not at the receiving end.
In February, it announced a strategic review, following "early-stage approaches from third parties".