Providence Equity Partners has made a significant investment in SCG, a U.K. provider of communications, connectivity and managed IT services for small and medium-sized businesses. Financial terms of the transaction were not disclosed.
SCG supports approximately 35,000 businesses through services spanning mobile connectivity, broadband, cloud communications, managed IT and cybersecurity. Its customers operate across healthcare, education, professional services, hospitality, construction and other industries.
The company has expanded through organic growth and acquisitions. Providence’s investment will provide additional support for SCG’s acquisition strategy and software-led growth across healthcare and education.
SCG’s proprietary platforms include Surgery Connect, a cloud-based telephone system developed for general practitioner offices, and Evonex, which provides communications services to small businesses and schools.
The company expects increased AI adoption to create greater demand for secure communications, connectivity and IT infrastructure. SCG also plans to incorporate AI-enabled capabilities into its proprietary platforms.
Following completion of the transaction, Daryl Pile will remain CEO. Founder Paul Bradford will become President and join the board.
SCG’s management team will reinvest alongside Providence, retaining an ownership interest in the company as it enters its next phase of growth.
Ares Credit funds will remain SCG’s debt financing partners after supporting the company since 2018.
The transaction remains subject to customary regulatory approvals.
Raymond James advised Providence on the transaction. White & Case served as its mergers and acquisitions counsel, while A&O Shearman advised on financing.
Houlihan Lokey served as SCG’s financial adviser, and Osborne Clarke provided legal counsel.
SCG employs approximately 900 people across the United Kingdom and South Africa. Its infrastructure includes the Fuse2 Session Initiation Protocol platform, a Tier 2 internet service provider network and two hosted telephony platforms.
The company distributes its services directly and through more than 450 partners.
KEY QUOTES:
“We believe SCG has established itself as a trusted IT and communications partner to thousands of UK SMEs through their customer service, deep sector expertise and mission-critical communications infrastructure.”
“As SMEs increasingly look for reliable experts with a comprehensive offering to manage their communications and technology needs, we expect demand for integrated connectivity, cloud communications and managed IT services to continue to grow.”
Michaël Vervisch, Managing Director at Providence Equity Partners
“This is an exciting milestone for SCG. We’ve spent decades building trusted relationships with our customers by helping them navigate changes in technology while delivering the service and reliability they depend upon every day.”
Daryl Pile, CEO of SCG
“SCG has always been focused on helping customers adapt as technology evolves while maintaining exceptional service. I’m delighted to remain actively involved within the business and will support the next stage of its growth alongside Providence and the management team.”
Paul Bradford, President and Founder of SCG
