LONDON, UK: Xplorer Capital has agreed to acquire the entire ordinary share capital of CloudCall Group at the rate of 81.5 pence for each CloudCall Share translating into £39.9 million.
The acquisition is an all cash offer for CloudCall by Xplorer Capital, unanimously recommended by the CloudCall Directors.
Xplorer Capital believes that CloudCall would benefit from returning to private ownership with the support of a growth-focused shareholder.
Xplorer Capital intends to provide the capital and long-term view of value creation to enable the management team to make the necessary investment in working capital to upgrade its technology platform, improve and expand product capabilities, and greatly expand and enhance the company’s sales capacity.
Xplorer Capital is a newly formed entity owned and managed by funds advised by Xplorer Capital Management LLC. Xplorer Capital Management LLC is a global technology investment firm based in Silicon Valley, California.
The core focus of funds managed by Xplorer Capital Management LLC is to invest in emerging and disruptive technologies that transform traditional industries on a global scale.
Xplorer Capital Management LLC likes to form long-term partnerships with founders and management teams, and works hard to support its portfolio companies by leveraging its experience and connections. The firm has approximately $500 million under management and is actively pursuing new investment opportunities that fit the fund’s thesis.
Following the outbreak of COVID-19, 2020 was a challenging year for the CloudCall Group with projected growth levels materially interrupted. In the first half of the year, revenues decreased by 7 per cent., and even though revenues recovered by 12 per cent. in the second half of the year (a V-shaped recovery) the net result was growth of only 4 per cent. for the full year.
Since the middle of last year, the CloudCall Group has seen the recruitment sector, which represents over 50 per cent. of its revenues, bounce back strongly with improving sales to new customers which accelerated through the first half of 2021.
At the same time, the CloudCall Group is operating in a marketplace where many of its key competitors are materially larger and better capitalised, some of which have raised, on average, over $100 million in additional funding since Q3 2020.
The CloudCall Board believes access to such capital will enable these companies to invest more and compete strongly in product development, customer service and sales. It also means they may be perceived as a more attractive employer “investing in growth” and in recent times the CloudCall Group has seen a more challenging environment for staff retention and recruitment.
Commenting on the acquisition, Keith Nilsson, founder and Managing Partner of Xplorer Capital Management LLC, said: “We are delighted to have reached agreement on the terms of the Acquisition with the board of CloudCall. We believe CloudCall would benefit from returning to private ownership with the support of a growth-focused shareholder and look forward to accelerating the growth of the business and helping it to reach its full potential by providing CloudCall with access to significant additional capital resources.”
Peter Simmonds, Non-Executive Chairman of CloudCall, said: “Over recent years, the management of CloudCall has continued to develop its product mix, enhanced its client base and positioned itself for growth. However, CloudCall operates in a highly competitive environment where many of its peers are larger and better capitalised and CloudCall will require additional funding to continue to support its strategy and remain competitive.
Against this backdrop, I believe the offer from Xplorer Capital represents an attractive premium, provides certain value today for CloudCall shareholders and provides CloudCall with the opportunity to access significant further capital to implement CloudCall’s strategy in the future.”
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