The private equity arm of Lloyds Banking Group has sold its stake in Manchester-based tech group Metronet (UK) to Isis Equity Partners for £45m.
Lloyds Development Capital, which ploughed £11m into Metronet in 2012, had made a four times return on its equity investment after selling the stake, it said.
Metronet is a business-only internet services provider, which was founded in 2003 and has expanded into Lancashire, Cheshire, Liverpool, Leeds and Birmingham with 1,200 customers.
“Over the past two years, we have worked hard to support Metronet’s growth aspirations as it capitalises on rapidly developing networking technology and demand for connectivity,” LDC’s north-west co-head Jonathan Bell said.
“Our investment has provided tangible, transformative change, which has helped to establish the business as a leader in the UK Internet service market.”
The fresh funds provided by Isis – which was founded in 1995 – will be used to boost the fast growing group’s expansion into other regions of the UK.
The investment was the fifth deal from ISIS’ fund, which raised £360m from investors 2012 to go and spend. Isis had previously backed companies like fashion retailer Bon Marche and online bike shop Wiggle.
Metronet boss Elliott said: “Metronet is entering a very exciting phase of growth and we have some major plans to invest in the network over the coming years to support geographic expansion. The investment from Isis will help us realise our ambition to build Metronet into the country’s leading B2B internet service provider.”
Revenue has almost doubled since LDC took a stake in 2012, the group added.
BEHIND THE DEAL
OAKLEY CAPITAL CF | JAMES CHAPMAN-ANDREWS
- Chapman-Andrews, director at Oakley Capital Corporate Finance, lives in west London – a short trip from the firm’s office in Sloane Square
- He started his career on the graduate scheme at BT, rotating around departments but had an eye on M&A so moved into BT Global Services’ bids and tenders team
- He joined Oakley Capital Corporate Finance in June 2011, having worked in the technology, media and telecoms team at Deloitte Corporate Finance
LDC and the management team were advised by Stuart Lees, Chris Hopwood, Phil Adams and Dominic Orsini from Altium. ISIS was advised by Oakley Capital, Pinsent Masons, LEK and PwC. Paul Jefferson of Gateleys provided legal advice for LDC, management and ISIS.