Dunedin backs £43 million management buyout of technology solutions provider Trustmarque

Dunedin, the UK mid market buyout house, has backed the £43 million management buyout of York headquartered Trustmarque Solutions (“Trustmarque”), a market leading provider of technology services and solutions to private and public sector organisations across the UK.

The business was acquired from LDC in a deal that saw Dunedin employ its trademark DebtBridgeTM solution, which ensures deliverability and certainty of debt funding.

Trustmarque has been in operation for over 25 years and helps organisations licence, deploy and manage technology solutions from a wide range of best-in-class developers including Microsoft, VMware and McAfee. Trustmarque focuses on providing professional services that enable customers to make better usage of their IT resources, optimise IT performance and significantly reduce IT expenditure.

The business recorded revenues of over £130 million for the year ended 31 August 2012. Dunedin’s investment will enable Trustmarque to expand its service offering and, correspondingly, its customer base.

The business employs 180 people at three sites in York (HQ), Bracknell and Edinburgh and currently serves over 1,200 clients including RBS, Lloyds Banking Group, Sainsbury’s and Capita.

Public sector clients include the NHS, Ministry of Defence, Ministry of Justice, HMRC, and local authorities and NHS trusts throughout England, Scotland and Wales.

Trustmarque was the first Microsoft partner to achieve Gold licensing status, a title that is reserved for their most trusted and successful partners, and remains the leading supplier of software and consulting services to the UK Government.

Trustmarque also enjoys recognition outside the technology sector. The Sunday Times ranked it as number 54 in their 2013 league of the best small companies to work for in the UK and the company has also been shortlisted by the National Business Awards scheme.

Trustmarque’s CEO Scott Haddow was recently shortlisted for the prestigious Ernst & Young Entrepreneur of the Year award and received the regional Management Team of Year award at the BVCA Management Team Awards in 2012 in recognition of “the positive impact of private equity and venture capital-backed companies on the British and global economies”.

Mark Ligertwood, partner at Dunedin, said:

“We are pleased to be investing in Trustmarque, a highly successful market-leader with a clearly positioned brand and an exceptional reputation within both the commercial and public sectors. The UK market for software and IT services is currently worth an estimated £40bn and is expected to grow at two per cent – per cent to 2016.

“The UK’s IT market is second only in size to that of the US and Japan and the growth opportunities are significant as private and public organisations invest in the latest products to increase business efficiency.

“Trustmarque has earned extensive market recognition for its performance to date and this is very much to the credit of its first class management team.  We share their vision for the continued transformation of the business and look forward to working with them.”

Scott Haddow, CEO of Trustmarque, said:

“Dunedin’s investment is a key milestone in the evolution of the business. Trustmarque has developed significantly over the last four years. Our ambition now is to cement our position as an independent, end-to-end technology services provider and the trusted adviser of choice for blue chip and large government enterprises.

“Dunedin took the time to understand our business, the journey we are undertaking and our long term goals. They share our passion and drive and recognise the opportunities that lie ahead.

“Dunedin’s DebtBridgeTM product meant that the deal could get done quickly, while ensuring certainty of delivery to everyone involved.”

Under LDC’s ownership, Trustmarque transformed from an IT reseller to a value-added provider of IT services, growing services-driven revenues to 33 per cent of turnover from a standing start, and its headcount from 110 in 2009 to over 180.  In 2011, Trustmarque acquired Nimbus Technology Systems as part of its strategy to enhance its cloud-based services offering.

Steve Harrison, Director at LDC, said:

“Trustmarque has developed into a market leader in value-added technology services. The transformation of the business is testament to the close working relationship that we developed with Scott Haddow and his team, and hard work behind the scenes to create a diversified business of significant scale in a highly fragmented market.

“We wish the business all the best in the future as it embarks on its next stage of growth with Dunedin.”

This investment follows three strong exits and the £34.5 million management buyout of Premier Hytemp, all of which have been completed by Dunedin during the last twelve months.  Dunedin has also completed a total of seventeen portfolio acquisitions since 2011.

Also involved in leading the deal for Dunedin were Dougal Bennett (partner), Jon Ma (investment director) and Jamie Moodie (senior associate).


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