Situation
In late 1996, Long Distance International Inc (LDI) was an emerging telecommunications operator in the US that was looking to build a network and to expand in the UK and Europe. To do this, LDI needed to raise around $25m to fund its expansion plans.
Approach
LDI appointed ARC Associates to assist it with the fundraising. In conjunction with LDI management, ARC Associates prepared a business plan and detailed financial models. Over a period of six months, ARC Associates then approached a number of prospective strategic investors as well as financial investors and developed a short list of parties, arranged meetings and assisted in the negotiation of terms for the investment.
The Transaction
After completing discussions with a number of venture capital investors, LDI decided to sell a minority equity stake to Advent International in return for approximately $25m in cash.