By Daniel Hunter
Business Growth Fund (BGF), established to help Britain's fast-growing smaller and medium sized businesses, has announced its first Midlands investment in GCI Telecom Group (GCI Com), an independent telecoms and data services provider, led by Midlands based IT and communications entrepreneur, Wayne Martin.
BGF has invested £10 million of equity capital to support GCI Com’s organic growth and active acquisition strategy, in return for a minority stake in the company.
Headquartered in Lincoln, GCI Com has a turnover of approaching £65 million and employs 220 staff across 9 UK locations. The group was formed in 2000 and has since grown rapidly, through a mix of organic growth and 19 strategic acquisitions. Today, it is one of the fastest growing managed communication providers in the UK with a 68% CAGR over the last two years.
GCI Com was founded by Group CEO, Wayne Martin, who has been involved in the communications industry for 25 years, having started his career at Cable & Wireless in the 1980s.
It has also been announced that John Cronin will join GCI Com as Non-Executive Chairman. John brings a wealth of executive and non-executive experience in growing and developing businesses in the technology and communications sectors, including senior roles at Arqiva Broadcast, Azure Solutions, NetSource Europe, Teleglobe, Kast Telecom, Mercury Communications and BT, and was introduced to the business by local executive search and recruitment firm Mallory Partners.
GCI Com services the rapidly expanding and converging data services and communications markets. It provides inbound and outbound telephony and data services to medium sized corporates and smaller enterprise customers on a national basis. Its high quality, blue chip customer base includes a diverse mix of companies from a wide range of sectors, including construction, industrials, media, retail and distribution.
The telecoms and IT services markets, in which GCI Com operates, are forecast to grow at between 5% and 50% as a result of the increased drive to outsourcing of infrastructure, services and software, particularly in the mid size corporate sector.
IT and communications systems are a critical part of any business infrastructure, but their increasing complexity and diversity and the resulting cost of having the requisite management skills in house has made the decision to outsource to specialist providers easier and more attractive. The macroeconomic environment is contributing to this trend, with businesses looking to reduce capital expenditure and operating costs while maximising revenues through improved efficiency.
“BGF’s investment is a major milestone for GCI Com. It gives us the opportunity to significantly build scale and service diversity at a time when our clients need it and the market conditions are ripe for growth," Wayne Martin, Founder and CEO of the GCI Com, commented.
"For us, BGF’s offer made good business sense. We have worked very hard over the last twelve years to build up a range of specialist services and wide network footprint to best service our customer base. BGF’s injection of capital and objective operational experience will help us to consolidate the progress we have made to date and continue our active acquisition programme.
"In the past we have relied on bank debt or company cash reserves to finance our growth. The thought of private equity backing had not particularly appealed. BGF made us think differently. I haven’t ceded control of my business, but am in a stronger position because of their involvement as a partner and long term equity investor to realise the ambitions that I have for it.”
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