Company buys loss making telecoms division of Coms Plc in multi-million deal
Managed services provider Timico has acquired the telecoms assets of unified communications provider Coms Plc for an initial £2.5 million.
It is the second purchase for Timico in the past week following an agreement to buy managed services provider Wirebird and is Timico’s ninth purchase in its eleven-year history. It is expected to be completed by the end of the month.
50 Coms Plc staff will be transferred to Timico pushing numbers to 350 and it will add 3,000 customers pushing its base past 12,000. The assets could cost Timico an additional £1 million depending on their performance with Coms Plc remaining liable for existing debts.
In a stock exchange announcement, Coms Plc, directors said that its telecoms division was losing millions of pounds and that the disposal was in the “best interests” of the company. It had announced in mid-April that it was looking to dispose of the business.
Coms Plc grew its annual revenues by 833 per cent to £23.1 million during the six months ending July 31 2014. It achieved this growth through the purchases of a number of businesses including IT solutions and data centre provider, Redstone, MVNO Smarter Mobile UK and managed services provider, Cloud XL. It also acquired the broadband customers of provider ADSL24, World Telecom and media companies Clicks Media Solutions and Darkside Animations.
Despite the growth in revenue it had a loss of £215,000 over the reporting period. These losses have continued to rack up, and it has also seen upheaval at boardroom level. Chief executive officer David Breith resigned his position in February and the group says it has now got a shortlist of candidates.
“We are delighted to be welcoming Coms customers into the Timico family,” said Timico chief executive officer Tim Radford. “We are a well-funded, stable business already trusted to look after the communications needs of more than 12,000 UK companies. I am confident that the structured support and expertise we can offer qualifies us as a safe pair of hands to take on these new customers.”