Castle Street Investments has acquired data centre and network services firm C4L for £20.2 million in cash and shares.
The Edinburgh-based investor, co-founded by entrepreneur Bill Dobbie following the sale of the Cupid online dating business, said the deal marked further progress towards its goal of becoming an “integrated IT services and cloud provider”.
Today’s acquisition comes a month after Aim-quoted Castle Street struck a £34.8m deal to buy IT and cloud services firm Selection Services Investments.
Castle Street chief executive Andy Ross said: “C4L has a high quality, next generation infrastructure which has been well invested. Allied to a successful business with high levels of recurring revenue it offers strong growth opportunities.
“The enlarged customer base and product portfolio strengthen and consolidate our position in the industry and as a board we are excited by this acquisition which supports the next step in the company’s development.”
Founded in 2000, C4L has 45 staff based in Bournemouth and London’s Docklands area, serving more than 800 customers. In the three months to 31 January it delivered an annualised turnover of £14m, “with further growth expected”, Castle Street said, adding that the acquisition will be “immediately earnings enhancing”.
C4L chairman and founder Matt Hawkins, along with chief executive Simon Mewett, will join the Castle Street board as chief technology officer and chief operating officer respectively.
Castle Street chairman Jonathan Watts said: “Matt and Simon have done an excellent job in building C4L. We welcome them to the board and look forward to their contribution as we continue to execute on our focused growth strategy.”