£30M merger creates next-generation cloud-centric managed services company

Alastair Mills and Mike Ing, in partnership with LDC, have brought together DoubleEdge Professional Services, Foehn, and Metaphor IT in an ambitious invest and grow strategy.  Kerv, a next-generation ‘customer-first, cloud-first’ managed services provider has launched in the UK today, created to help mid-market customers achieve successful business outcomes in a new digital era.

Leading mid-market private equity house, LDC, has provided funding to enable the £30 million merger of three highly complementary, cloud-based managed services businesses to form Kerv: DoubleEdge Professional Services (UC, voice, data, mobility and compliance); Foehn (R&D team, Cloud UC and Contact Centre provider) and Metaphor IT (Cloud Services, Digital Workspaces, and IT Managed Services).

All three businesses are delivering double-digit growth rates in their own right and the new business will drive further organic growth, as well as identify further complementary acquisitions, supported by follow-on funding from LDC.

The group has been brought together by Alastair Mills, Six Degrees Group founder and former CEO, and also Mike Ing, former COO at Six Degrees Group.

Kerv comes to the market with current revenues approaching £20 million and a team of 100 across offices in central London; Richmond, Greater London and Vigo, Spain. It will offer business outcome focussed solutions, initially comprising converged IT managed services, unified communications, contact centre, security and compliance applications, all delivered in a way that will set the industry benchmark for excellent customer experience.

The leadership team at Kerv will consist of Alastair Mills as Executive Chairman; Mike Ing, Managing Director and Andrew Marshall, group CFO. The management team of each of the three businesses all stay with Kerv and join the senior team.

Kerv’s proposition puts the customer front and centre – helping to solve business problems and navigate a successful path into a more digital-led future. Through organic growth, acquisition and partnership Kerv is setting out to establish itself as a highly differentiated IT partner with a longer-term customer value proposition than the current norm. The explosion of high quality cloud solutions and the pace of innovation have changed the landscape for managed service providers and the array of options for mid-market customers.

Kerv is setting out to differentiate by delivering exceptional customer experience (CX) and a ‘cloud-first’ strategy. An in-house development team, based in Spain will seamlessly integrate proprietary and third party cloud applications with a rich user interface.

As enterprise solutions are increasingly delivered by a combination of various cloud-based applications, software development and integration are essential skills for delivering tailored, end-to-end solutions.

Alastair Mills, Executive Chairman, Kerv says: “Customers want to buy a wider range of integrated solutions from a trusted partner whilst leveraging the power of cloud technologies. But they will only do so if those providers can continue to deliver excellent customer experience in this rapidly changing market. As we focus on organic growth, supplemented by carefully targeted acquisitions, we will not lose sight of our customer-first strategy.”

Underpinning the Kerv strategy is a multi-million pound investment in the future. Kerv is developing a next generation, cloud-centric operating platform specifically designed to make it easy, quick and efficient to deliver a diverse and extensive range of future-proofed services. The platform will be a crucial component in providing the best possible customer experience.

Alastair Mills continues: “Our goal is not to chase short-term profit gains through aggressive cost cutting as we acquire complementary businesses. Instead, with the support of LDC, we plan to invest in great companies and accelerate organic growth through a relentless focus on CX. In a technology market that continues to consolidate rapidly through M&A, we feel that now is the right time for a change in focus and culture.”

Commenting on the impact of the current Coronavirus pandemic and the timing of the company launch, Mike Ing, Managing Director, Kerv adds: “Since we sketched out our CX-focussed investment plan towards the end of 2019, we’ve seen a dramatic shift to cloud-based remote working at an unprecedented scale. With the increasing availability of rapidly innovating cloud based applications, IT managed service providers should no longer need to be asset heavy, or rely on long term infrastructure investments, their job will be to integrate best of breed capabilities to deliver solutions for their customers.

“As a cloud-first, customer-first business we have the combined capabilities to help UK businesses navigate a new way of working as they adapt to an agile, technology-led environment post the pandemic.”

The transaction was led by Head of LDC in London Yann Souillard, Investment Director Aylesh Patel and Investment Manager Lewis Winston. Yann comments: “We’ve been working with Alastair and Mike for some time and we’re all equally excited about the growth potential of Kerv. The combination of customer-focused cloud-based solutions, along with Alastair and Mike’s track record and our approach to long-term partnership all stand the business in good stead to become a market leader.”