Situation
first:telecom is one of Europe's fastest growing telecommunications companies with operations in the United Kingdom, Germany and France. first:telecom focuses on serving the communications needs for voice and data services of small and medium businesses ("SMEs"), those that work from small offices and from home ("SoHos") and high value businesses across Europe.
In October 1999, first:telecom raised private equity financing of £40 million from Providence Equity Partners and Morgan Stanley Capital Partners to accelerate its broadband data services strategy in Europe, both organically and through acquisitions.
ARC Associates was retained by first:telecom to identify potential internet service provider ("ISP") acquisitions for first:telecom in its countries of operation.
Approach
ARC Associates established the most important criteria for target companies in conjunction with first:telecom management and conducted extensive research to identify the most suitable candidates for acquisition.
Cerbernet Limited ("Cerbernet") is a London based business ISP that has one of the fastest and most resilient networks in the UK. Preliminary meetings conducted by ARC Associates enabled first:telecom to gain the level of information needed to structure an offer.
The Transaction
ARC Associates co-ordinated the accounting, legal, commercial and technical due diligence teams in the transaction. Particular emphasis was placed on facilitating the transaction from the selling shareholders' perspective in terms of tax planning and the structure of the offer.
The transaction was completed on 29 February 2000.