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19 Mar 2007
Bosses at VAR Calyx could be gearing up to launch a management buy-out (MBO) in an attempt to replicate the privately backed growth strategies pursued by rivals Azzurri and 2e2.
Calyx’s board of directors have given a team, led by chief executive Maurice Healy, permission to seek funding for the deal, which CRN understands will be for the whole company.
Having completed its initial public offering in March 2005, Calyx has since acquired VARs Matrix and Mentec, and achieved a turnover of ¤29.3m for the first half of 2006.
Gary Kennedy, non-executive director at Calyx, who is chairing the sub-committee responsible for evaluating any potential bid, said he was “eagerly awaiting a response” from the MBO team.
He told CRN: “With the recent acquisitions of Matrix and Mentec, Calyx is already a sizeable company. I presume that, if management wants to take it private, they feel they can grow the company further.
“I believe that these things should not go on for too long because it disrupts business. I would like them to move as quickly as possible.”
The move has also sparked speculation among channel players that Calyx is aiming to mirror the private equity (PE)-backed shopping sprees pursued recently by other resellers.
Ian Smith, chief executive of VAR Fujin and former Matrix chief executive, said: “There are at least two very successful privately backed roll-ups taking place in the industry: 2e2 and Azzurri. They’ve set a good example to follow and I would guess this is the model Maurice is looking to replicate.”
John Hughman, senior analyst at market watcher Ernst & Young, told CRN he expected to see a glut of PE-backed deals in the IT space this year.
“Over the past couple of years, PE firms have played in the telecoms and media sectors,” he said. “As they’ve now reached a point where there’s nothing left to buy, technology is now coming onto their radar.”
Mike Hockey, business development director at 2e2, which is backed by Duke Street Capital, said: “PE is a great way to give good companies the resources they need to accelerate their growth.”
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