Daisy will take control of 80,000 clients from TalkTalk from July 2018
TalkTalk has agreed to sell its direct B2B business to the Daisy Group in a deal reportedly worth £175 million. It is expected that the deal will be completed in late July this year.
The deal sees Daisy take control of TalkTalk’s 80,000 SoHo, SME and large enterprise clients with immediate effect as both companies signed heads of agreements on the proposed deal with the clients representing 20 per cent of TalkTalk B2B revenues.
Since 2007 TalkTalk and Daisy has worked alongside each other as part of a strategic alliance and despite the proposed deal, customers will continue to be served through TalkTalk’s network.
The sale enables TalkTalk to continue growing its core strategic partner and wholesale business, providing services through over 800 channel relationships.
Such channels represent over 90 per cent of TalkTalk B2B customers and more than 80 per cent of revenue. There has also been an 11 per cent two year growth in compound annual growth rate (CAGR).
The proposed sale will see EBITDA down by £15 million, although will strengthen the TalkTalk balance sheet, allowing for investment in sustainable growth with plans to build a new full fibre network to three million homes and businesses in partnership with Infracapital.
TalkTalk chief executive Tristia Harrison said: “Last year we set out a strategy to radically simplify the business, focusing on fewer priorities that offer the best growth potential.”
“TalkTalk has real strength in the partner and wholesale markets, where we have scale and a clear leadership position.”
“This proposed deal would allow us to focus on growth in these core B2B markets. As an existing strategic partner, Daisy is well placed to serve all direct customers, who would remain on our network and provide ongoing revenue.”