Equistone Partners Europe exits Easynet in 22 months

Funds managed by Equistone Partners Europe have disposed of their controlling stake in Easynet, a leading global managed service provider, via a trade sale to Interoute. 

In December 2013, Equistone invested £53.2m for a controlling stake in Easynet, created by simultaneously acquiring MDNX and Easynet Global Services, two leading managed network service providers. The successful merger created Europe’s largest specialist network and hosting integrator in Europe.

During the immediate 18 months post investment, Equistone worked alongside the management team to support the successful integration of MDNX and Easynet Global Services. The comprehensive integration plan was crucial to Equistone’s investment thesis and was delivered by the management team ahead of schedule. This resulted in significant EBITDA growth as well as the creation of a market leading independent pan-European networking and managed services provider, combining the strength of the Easynet brand and its well-developed European footprint with the sophisticated back office automation, business systems and carrier integration business model of MDNX.

In addition, the increased scale achieved by the combination of MDNX and Easynet has enabled the business to offer a broader range of managed services and hosting solutions to enterprise clients on a pan-European basis.

The exit, the first in the UK from Fund IV, delivers a money multiple of 2.2x for Equistone.

Commenting on the exit, Rob Myers, Managing Director at Equistone said: “The successful realisation of our investment in Easynet, in less than two years, represents a highly positive outcome for Equistone. The investment thesis was entirely focused on the rapid integration of MDNX and Easynet, which were acquired simultaneously in two separate transactions. The management team delivered a first class result by integrating two complex businesses ahead of schedule which generated material operational and financial synergies.  The combined business created a pan-European network integrator of genuine scale, which Interoute identified as a strategically attractive acquisition.”

Mark Thompson, CEO at Easynet added: “Following Equistone’s investment and the merger of MDNX and Easynet Global Services in 2013, the business has followed and delivered on a clear strategy. As a result, and with the support of Equistone, the business has successfully moved to the next level in terms of service offering and coverage thanks primarily to increased scale. I am sure that the next part of the business’s journey alongside Interoute will be an exciting phase.”

For Equistone, the transaction was led by Rob Myers, Tim Swales, Joyce Church, Andi Tomkinson and Chris Candfield. Equistone was advised by Travers Smith (Legal).