Esteem Announces Management Buy Out To Drive Future Growth
19th November 2004
IT services provider, Esteem Systems, has today announced a Management Buy Out of the company in a deal designed to enable the business to continue to build on its existing growth and become a major IT services provider in the UK.
Backed by private equity firm, Primary Capital and Lloyds TSB, the transaction will enable Esteem to look at potential acquisitions to complement the existing business and drive future growth.
The company will continue to be led by existing directors Alastair Kitching, Gary Pearson and Tim Loughlin and as part of the transaction they will be joined by Joe Connolly as CEO. Rob Foreman also joins the Esteem board as representative of Primary Capital. Existing CEO & Founder of the company, Richard Doyle will retire as a director of the company along with fellow directors, David Ogden and John Atkin.
Joe Connolly, new CEO of Esteem said, "I am confident that with the investment this deal has secured, the huge potential of Esteem in the IT services market can now be realised. The company already has great management combined with a proven track record and I am looking forward to working with the existing directors as we seek to expand through both organic and acquisitive growth."
Rob Foreman, who joins the Esteem board on behalf of Primary, commented "Esteem has an excellent reputation with its customers and partners and provides an opportunity for us to back an experienced management team in a market with strong growth prospects. The deal represents the third investment in the IT Services sector from our current fund and the second in the region within 18 months. In addition, the team's business plan matches our appetite for supporting follow-on acquisitions and we look forward to working closely with the team in taking Esteem forward."
Andrew Foster of Lloyds TSB Corporate Acquisition Finance commented; "This transaction is a natural progression for what has become one of Yorkshire's most exciting technology companies. It was easy to see the potential of the new structure and to back such a strong venture alongside Primary Capital. The new team and the experience it brings will enable the company to break into new markets and will take the business forward from its excellent foundations."
Richard Doyle the Founder and previous CEO of Esteem said, "I'm absolutely delighted with the outcome of this deal, I could not leave the business in better hands."
The Management Buy Out team was advised throughout the process by Kroll Corporate Finance. The deal has also received the full support of Esteem's key partners with Leslie Stretch, UK MD of Sun Microsystems and Lewis Gee, MD of Citrix UK & Ireland among those who were closely consulted throughout.
Editors Notes:
Esteem Systems
Esteem Systems was founded in 1985 and has experienced rapid yet sustained
growth to achieve an annual turnover of £30m. Supported by regional
offices throughout the UK, Esteem employs over 100 members of staff and specialises
in providing end-to-end IT infrastructure services and solutions. Key partners
of Esteem include; Microsoft; Sun Microsystems; Citrix Systems; Veritas and
Oracle.
This year to date Esteem has received numerous awards in recognition of
its excellence including a Deloitte Fast 50 award for the seventh year running;
the Sun Microsystems’ Storage Partner of the Year Award; and the Citrix
Highest Productivity Award as well as Best Marketing Campaign Awards from
both Citrix and Appsense. The company is also a previous winner of the National
Business Awards North East Business of the Year; Yorkshire Technology Company
of the Year; and the Yorkshire Awards Employer of the Year. Esteem also holds
the Investors in People Standard.
Joe Connolly
Joe started his career at IBM, most recently he was the European Managing
Director for Synstar. Having completed a MBO from Granada Computer Services
Joe went on to successfully float Synstar where he remained for a further
2 years before exiting the business prior to the most recent events,
it's sale to HP.
Primary Capital
Primary is an independent private equity firm, founded in 1995, which invests
in middle-market management buy-outs, buy-ins and development capital
opportunities in the UK and/or continental Europe. Primary works closely with
management to develop their business by providing long-term financial resources
and strategic support over a three to seven year period. Primary's second
fund, Primary Capital II, was closed in March 2002 at £100 million.
Previous investments include Becom Informationssyteme, Rhyme Systems, In-bond,
P+Z Engineering, Coffee Nation, The Works and YO! Sushi. Esteem Systems is
the eighth investment in the second fund.
Lloyds TSB Corporate Acquisition Finance
Lloyds TSB Corporate Acquisition Finance is the leveraged debt business
of Lloyds TSB, specialising in leading leveraged debt finance. They are one
of the largest providers of senior and mezzanine debt in the UK market with
a leverage book in excess of £2bn.
If you require any further information, please contact our Press Officer on 01937 861000 or e-mail on press@esteem.co.uk
