XLN Appointed Advisor 2006-2009
Founded in 2002, XLN supplies fixed line and broadband services to more than 80,000 customers in the SME sector, typically to businesses with fewer than 10 employees. Working closely with the management team since 2006 we identified a number of strategic targets to compliment the organic growth plan for XLN. Following the management buy-out by Private Equity firm Zeus Private Equity (ZPE) in 2008, the engagement focused wholly on developing the relationship previously established with the main identified target, Worthing-based One Bill.
OneBill which operates in the same telecoms market as XLN, providing fixed line and broadband services to a customer base of small and medium-sized businesses. OneBill offered a new route to market to the XLN group, in the form of a selection of contracted agencies that sell its products. The acquisition also added 24,000 business customers to the client base, bringing the total to over 100,000. RBS provided senior debt alongside ZPE who backed the management buy-out of XLN in January 2008.
The acquisition of OneBill Telecom in March 2009 is the stand-out success of XLN in recent years, consolidating XLN’s position in the telecoms market, making it one of the UK’s largest independent providers. The operational synergies between the two companies enabled rapid and successful integration and productivity gains, maximising the combined group’s financial performance and significantly increasing shareholder value.
Since 2007, and the acquisition of OneBill Telecom, XLN's revenues have grown from £27 million to £54 million. ZPE invested £6.63 million to back the management buy-out of the company in 2008, investing a further £2m to support the acquisition of One Bill. With the enterprise value of XLN achieving approaching £80 million in 2010, Zeus reported that it achieved a multiple of 4.5 times its original investment from the sale to ECI.
In recognition of the contribution made in the development of XLN under the ownership of ZPE, ECI entered into an M&A advisory arrangement in 2011.
"Since appointing Evolution Capital we have been delighted with the service they have provided." Christian Nellemann, CEO of XLN Telecom Ltd