Daisy is planning to spend £175 million on acquiring TalkTalk’s 80,000 direct B2B customers. According to TalkTalk this represents around 20% of its B2B base, the rest being made up of wholesale and indirect business customers.

This is something of a sleight of hand, as the customers it is selling to Daisy will continue to use TalkTalk’s network via a wholesale agreement with Daisy. From TalkTalk’s perspective the move is said to be to ‘simplify’ its business as part of its restructuring.

TalkTalk says it will continue to grow its wholesale base which it serves indirectly through partners such as Daisy, Fujitsu and Verizon. It has appointed BT veteran Paul Reynolds to run this unit.

TalkTalk CEO Tristia Harrison said: “Last year we set out a strategy to radically simplify the business, focusing on fewer priorities that offer the best growth potential. TalkTalk has strength in the partner and wholesale markets. It represents the vast majority of our revenue and profit and we see an opportunity to continue growing at pace. This proposed deal would allow us to focus on growth in those core B2B markets while also removing significant complexity and cost from the business. As an existing strategic partner, Daisy is well placed to serve all direct customers who would remain on our network and provide ongoing revenue.”

Daisy Group has grown substantially by acquisition since it was formed in 2009 from the assets of other small telecoms resellers. It is said to have acquired 46 companies to reach its present size. For example:

  • 2010 – murphx Innovative Solutions Ltd bought for £4.8 million, using this as the basis for Daisy Wholesale
  • 2010 – Managed Communications bought for £6.3 million
  • 2010 – Network Europe Group bought for £23.5 million
  • 2011 – bought O-bit Telecom
  • 2015 – bought Damovo, adding 250 large enterprise customers
  • 2015 – bought Phoenix IT group and added a further 3,600 business customers in a deal valued at £135 million
  • 2017 – completes acquisition of Voice Networks for £184 million
  • 2018 – bids for the direct business customer base from TalkTalk for £175 million, adding 80,000 businesses
  • 2018 – acquires Voice Mobile.

It is now rumoured to be for sale itself with a £1 billion+ price tag attached, with revenues said to be around the £120 million per year mark in 2017. Its direct sales to mid-sized and large enterprises comprise around 60% of its business, with the rest spread between 1,400 resellers.

Update – 2 July 2018: According to a filing issued to the London Stock Exchange, talks have now broken down between Daisy and TalkTalk. However, it can console itself with Voice Mobile. See Daisy acquires Voice Mobile but stumbles with TalkTalk.

 

 

 

 

 

 

Posted by Teresa Cottam

Teresa helps B2B service providers improve their commercial results and the customer experience they deliver through research, insight and analysis that builds effective strategy. She is a judge of the GSMA GloMo's for customer experience and enterprise innovation, and for the UK Cloud awards. You can follow her on Twitter @teresacottam

One Comment

  1. […] deal that would see Daily buying TalkTalk’s direct B2B customer base for £175 million (see Daisy bids for TalkTalk’s direct B2B customers). TalkTalk commented: “TalkTalk and The Daisy Group have jointly agreed not to proceed with […]

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