MXC's Calyx magic act lauded by analyst

MXC Capital makes £5.3m profit from its two-month involvement with VAR as sales of constituent parts to Daisy, Chess and Redcentric close

MXC Capital's success in generating returns from Calyx Managed Services "where others had given up" has been lauded by an analyst as the sale of its three constituent parts to Daisy, Chess and Redcentric was closed.

In all, MXC trousered a £5.3m profit from breaking up the business after TUPE process surrounding the trio of deals completed this morning.

According to analyst Megabuyte, Calyx MS – whose turnover had plunged by a quarter to £24m over two years – was a "long-term underperformer" on which most potential investors had turned their back.

Tech investment house MXC Capital won a bidding war to acquire Calyx MS for £9m in February, before selling off its break-fix and carrier arms to Daisy and Chess a month later for a combined £5.55m and the remaining managed services activities to Redcentric for £9m at the beginning of April.

Redcentric announced its part of the three-way breakup, which was conditional on the completion of the two other deals, has closed this morning.

"The formal closing of the three deals finally puts an end to Calyx's struggles as a sub-scale IT services provider, with each division finding a much better home in larger, well-financed businesses that enjoy economies of scope and scale simply not available to Calyx," Megabuyte said.

"More broadly, the deal underlines how a proactive, well-connected investor such as MXC Capital can generate returns where others had long given up."

The managed, professional and infrastructure and professional services business Redcentric bought boasted a turnover of £9.1m. Megabuyte estimated the deal would add about eight per cent to both Redcentric's revenues and EBITDA for a "measly" six times' EBITDA.

Other VARs MXC Capital has been involved with in recent years include Xploite, Accumuli, Redstone and Maxima.