Maintel trebles in size with £48.5m Azzurri deal

Azzurri sells up to fellow unified comms provider

Two of the UK's largest comms providers - Maintel and Azzurri - are joining forces to create a £150m-revenue giant.

Maintel announced this morning that it has entered into a conditional agreement to acquire Azzurri for an enterprise value of £48.5m, continuing an acquisition spree that has recently taken in Datapoint and Proximity Communications.

AIM-listed Maintel said the reverse takeover would accelerate its shift into hosted cloud and build on its managed services business.

Azzurri is twice as big as Maintel in revenues, reporting sales of £101.3m in its last financial year compared with £50.6m for Maintel.

Despite its larger stature, Azzurri has suffered financial turbulence in recent years, undergoing a refinancing in 2014 and subsequent cost-reduction programme. The firm's position has "strengthened notably in recent times", however, Maintel said, which it claimed was testament to the firm's new leadership, including CEO Chris Jagusz (pictured).

In its fiscal year ending 30 June 2015, Azzurri - which recently invested in a fourth datacentre - saw pre-tax profit drop from £2m to £1.2m and revenue fall three per cent to £101.3m.

Maintel said it will finance the acquisition through a £24m share placing and £36m of new debt facilities with the Royal Bank of Scotland.

The acquisition will be immediately earnings enhancing, Maintel added, and will lead to a projected £4.6m in total annual cost synergies by 2017.

Maintel CEO Eddie Buxton said in a statement that Azzurri is a "highly respected business".

"This acquisition will accelerate Maintel's shift into hosted cloud and data, ensuring we are well positioned to take advantage of these high-growth areas of the unified communications market," he said. "It will also build scale in managed services, continuing the shift in our business mix, which we have been driving following previous acquisitions."

Azzurri's Jagusz added: "We are really pleased at the prospect of joining Maintel because this enables the combined business to offer its customers a broader range of services. Our employees will benefit too by being part of one of the most significant players in our market".