Mid-market investor Palatine Private Equity has acquired a majority stake in FourNet, a digital transformation and customer experience company. Since 2017 it has been backed by YFM Equity Partners, which took a minority shareholding.
The investment from Palatine will see YFM and two of the founding shareholders, Frank Jennings and Mike Jervis, realize their shareholdings and exit the business.
FourNet CEO Richard Pennington said, “Our new partnership with Palatine further positions us as a prime player in the technology sector and we are delighted to be working with their team. The pandemic has been a catalyst for significant change in working practices and our industry over the past 12 months and fresh investment will enable FourNet to rapidly meet the changing needs of our customers, many of whom are critical to the UK’s success following the pandemic, and to build and acquire the additional capabilities that our customers require. Palatine’s investment will keep FourNet at the forefront of the industry and will also provide the fuel for us to lead further change across the sector while allowing us to capitalize on the rapid growth in demand for cloud, collaboration and managed service solutions.”
Andy Strickland, senior investment director at Palatine, commented, “We see significant opportunity for FourNet to strengthen its position in the marketplace as the go-to cloud services supplier to the public sector. Given our strong track record in the TMT sector and in IT, cloud and managed services in particular we believe we will be able to assist management in capitalizing on the market opportunity. As part of the strategy we will look at selected buy and build opportunities, but we also see great potential for organic growth. We also see a major opportunity to work with management to further develop the company’s already strong ESG credentials, an area where there is ever-increasing awareness and significance during the public sector procurement process. ESG is an integral part of the value-add proposition Palatine brings to the businesses it invests in.”
The shareholders were advised by investment bank GCA Altium. Palatine was advised by BDO (corporate finance), Gateley (legal), Spectrum (banking), RSM (Tax) and Intechnica (IT). Debt financing was provided by Kartesia.