Fri 05/13/2022 13:26 PM
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Relevant Documents:
FY’ 20 Financial Report

U.K. managed cloud service company Digital Space, fka Timico, is working with Oakley Advisory to start a sale process later in the year, sources told Reorg. The Horizon Capital-backed company is marketed off EBITDA between £10 million to £12 million and has targeted a valuation multiple between 10x and 13x.

Digital Space sale process by Reorg's EMEA Middle Market team.

Horizon Capital acquired the company in 2017 committing £35 million, according to the sponsors’ website. Since Horizon’s acquisition, the company has completed three acquisitions. Ares is the incumbent lender of the company.

The following debt facilities supported the acquisition, according to the company’s financial accounts:

  • A £9.3 million loan note maturing in January 2025 and carrying a 12% coupon;

  • A seven-year £21 million senior facility maturing in January 2024 with a 7% coupon;

  • A £4 million RCF maturing in January 2024 with a 2.75% interest rate.

  • A capex facility maturing in January 2024 out of which £24.4 million were drawn as of Dec. 31, 2020.

In 2020, the company reported revenue increased 6% to £58 million. Adjusted EBITDA rose 24.4% to £9.5 million and adjusted EBITDA margin was 16.3%.

As of Dec. 31, 2020 the company’s net debt amounted to £57.3 million. A summary of key financials is below:

Digital Space provides cloud and managed services in the U.K. across private and public sectors. The business serves more than 200 clients and employs more than 250 people.

Oakley Advisory and Horizon Capital did not respond to Reorg’s request for comment.

--Lucía Camblor, Andrew Ross
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