Cloud comms provider CloudCoCo is set to acquire Systems Assurance as part of its ‘Get Bigger’ strategy.
Sheffield-based Systems Assurance is an IT group comprising of a B2B VAR, an automated cloud-based VAR and a managed service provider. Unaudited results for its year ending 31 December 2020 showed it had generated revenue of £6m and had an adjusted EBITDA of £209,000.
CloudCoco is proposing the acquisition with fundraising of £2.1m before expenses through a conditional Placing of 210,000,000 new Ordinary Shares at a price of 1p per share. The Placing is expected to fully fund the acquisition of Assurance Systems.
Mark Halpin, Chief Executive of CloudCoCo, stated:
“This Placing and Acquisition is set to be a transformative step forwards for CloudCoCo. It sees us progress to the next stage in our development – ‘Get Bigger’ – which will see us focus on scaling the business while winning larger and longer contracts.
“I would like to welcome the Systems Assurance team to the fold. They bring with them fantastic technology and an impressive customer base that not only complement the existing CloudCoCo business but will help unlock its potential through driving substantial efficiency gains and introducing new cross-selling opportunities”
Systems Assurance provides a scalable hardware engine into CloudCoCo’s existing business, while its e-commerce division increases the purchasing power of the wider group and expands its product portfolio.
The proposed purchase indicates the start of the MSP’s ‘Get Bigger’ phase, which it intends to achieve through organic and inorganic growth. It follows the completion of its ‘Get Well’ and ‘Get Fit’ phases.
“I am grateful to all those who have joined us on our journey through the Placing. As well as making the acquisition possible, it has given us the opportunity to strengthen our balance sheet while giving us headroom to explore further M&A activity – a key focus for the Group in the short-term,” Halpin continued.
“This is the start of an exciting new chapter in the CloudCoCo story and I look forward to reporting on further progress in due course.”
