Hessle-based high growth broadband provider Quickline Communications is to be bought out by a private investment firm in a deal worth almost £50 million.
Northleaf Capital Partners has agreed a deal for the business, buying the shareholding of BigBlu Broadband Plc.
It comes as former KCom managing director Sean Royce is about to become chief executive of the firm, which has won major government contracts to roll out super fast broadband to hard-to-reach areas.
Those behind the deal say it will allow Quickline to "achieve its growth strategy across all aspects of its comprehensive business plan, including its infrastructure, people and systems".
Quickine began with line of sight technology and is now embracing 5G and fibre solutions, specialising in rural areas.
Founded in 2008 by Steve Jagger, chief technology officer, AIM-listed Big Blu swooped in 2017. It will now concentrate on interests in Australasia and the Nordics.
He said: "We’re delighted with the prospect of working with Northleaf and accelerating the investment in gigabit capable broadband infrastructure across the North of England and beyond. With Northleaf’s support, we can make a real difference to our rural communities, helping narrow the digital divide whist also creating hundreds of jobs across our region."
The deal represents a return of up to 5.8 times the cost of investment, bringing a £31.1 million payment on completion - anticipated in June - and a further £10.1 million based on performance through the following year.
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Outstanding parts of the deal could see an 8 per cent stake retained in the firm, which has plans to connect 170,000 homes in the coming years, widening its footprint in the North.
It would see 500,000 properties surpassed by the 52-strong team. Both it and the £3 million turnover are tipped to significantly increase as it rolls out.
Andrew Walwyn, chief executive of Bigblu, said: “The management team has extensive experience in the sector and a track record of building attractive assets and delivering shareholder value.
"Through the sale of Quickline, BBB has once again demonstrated its ability to maximise the value of its interests in the high growth broadband connectivity market. This is now the second time that the board has realised excellent returns for shareholders.
“BBB remains on a strong financial footing, enabling the board to consider appropriate means of returning surplus cash to shareholders whilst also considering the opportunities within its continuing operations so as to ensure the continued future growth of shareholder value for BBB’s shareholders.”
Northleaf is a Toronto-headquartered global private markets investment firm managing assets of more than £11 billion. It focuses on 海角视频, US and Australian interests outside the Canadian home market where it began in 2009, having been a subsidiary of TD Bank Financial Group.
Roderick Gadsby, head of Northleaf’s infrastructure activities in the 海角视频 and Europe, said: “We are pleased to have agreed to acquire Quickline as the company is an excellent fit with our communications infrastructure strategy and our broader portfolio of mid-market infrastructure assets. We look forward to working closely with the management team as they execute the business plan and accelerate the delivery of gigabit capable fixed wireless and FTTP services to underserved rural regions of the 海角视频.”