Houlihan Lokey Advises Daisy Group

Houlihan Lokey is pleased to announce that Virgin Media O2 and Daisy Group have today announced plans to merge their complementary direct B2B operations to create a major new force in the U.K. business communications and IT sector. With annual pro forma revenues of around £1.4 billion, the new entity, formed of substantially all of Virgin Media O2 Business and Daisy Group, will be consolidated by Virgin Media O2, with Daisy Group holding a 30% stake. Houlihan Lokey acted as the exclusive financial advisor to Daisy Group.

Founded by Matthew Riley in 2001, Daisy Group is one of the U.K.’s largest independent, specialist communications businesses. It delivers a range of cloud, communications, and IT solutions to companies across the country. Having expanded the business organically and through a series of acquisitions over the past two decades, Daisy Group is one of the country’s most successful growth stories.

The deal is value-accretive for all parties and is projected to drive further growth through greater scale, efficiencies, and a combined set of products.

The company will be led and chaired by Mr. Riley, with Jo Bertram, Managing Director of Virgin Media O2 Business, as CEO, creating a highly experienced leadership team with a deep understanding of the sector. The management team will combine the best talent from both organisations. At the outset, both businesses will operate under their separate brands from their current office bases.

The dedicated new company will serve the communications and IT needs of hundreds of thousands of U.K. businesses—small offices, SMEs, large enterprises, and public sector organisations, as well as indirect partners. It will have greater scale, expertise, and focus, while boosting digital capabilities, benefitting from Virgin Media O2’s next-generation fibre and mobile infrastructure, combined with Daisy’s end-to-end IT and sales management platforms and award-winning customer service.

The company will be supported by fixed and mobile connectivity wholesale agreements with Virgin Media O2, and supplier arrangements with Telefónica and Liberty Global to leverage high-growth products and services from across the portfolio of those wider shareholder groups.

Daisy Group Founder and Chairman, Mr. Riley, commented: “This is a significant milestone in Daisy’s 24-year history. This transformational transaction will revolutionise the telecommunications and IT landscape and create the most comprehensive offering for businesses of all sizes across the U.K. Growth is top of the political and business agenda—inextricably linked to this is access to world-class IT and communications infrastructure that is integrated and can scale. Our new entity, which brings together two highly successful companies, will deliver a comprehensive solution for the fast-changing needs of U.K. organisations, supported by specialist teams that have a relentless focus on customer service. It will be driven by the entrepreneurial spirit for which we are known and will catalyse the next phase of our ambitious growth plans.”

Houlihan Lokey advised on key commercial aspects during the process of the transaction, advising on deal strategy and structuring and assisting in negotiations on transaction documentation. This is the latest of several “round trips” with Daisy Group, which included the £1 billion Giacom sale to Inflexion’s minority partnership fund in 2021 and the sale of Daisy Corporate Services to Wavenet (majority owned by Macquarie Capital) in 2024.

Completion of the deal remains subject to customary regulatory approval and is expected to close in H2 2025.

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