Telecoms entrepreneur Matthew Riley, founder and executive chairman of Daisy Group, is reportedly in the final stages of a merger deal involving Wavenet, a company majority-owned by Australian financial giant Macquarie. According to sources, the deal will see Daisy’s Corporate Service Business demerged from the group and incorporated into Wavenet, creating a combined company with a valuation of over £1bn.
The merger, which is expected to be announced this week, is backed by both Macquarie, which will remain the largest individual shareholder, and debt financing from Ares. Upon completion of the deal, the combined group, also named Wavenet, will become the largest independent provider of managed services in the UK, with over 20,000 enterprise customers including Costain, the NHS, and Transport for London.
The deal marks the second billion-pound transaction led by Mr. Riley, who recently secured a £215m takeover of cloud communications provider 4Com. Wavenet will continue to be led by executive chairman Bill Dawson, with Mr. Riley joining the board as a non-executive director.
In response to an enquiry from Sky News, Wavenet chief executive Philip Grannum stated, “This deal brings together two prolific consolidators, making Wavenet the largest independent Managed Service & Security Provider for large SME & corporate customers. It provides both Daisy and Wavenet customers greater access to enterprise-grade solutions combined with the very best customer service and gives fantastic career opportunities for our employees.”
Houlihan Lokey, a leading investment bank, is advising on the deal. Mr. Riley has established himself as a prominent dealmaker in the sector, acquiring rivals such as XLN Telecom for £210m in 2022. Daisy’s growth has positioned it as the second-largest SME telecoms provider in the UK, behind only BT Group.
Daisy was previously listed on the public market in London but was taken private in 2014 with the support of Toscafund Asset Management. Mr. Riley was unavailable for comment on Tuesday, and Macquarie declined to comment.
