Target Information

Communicate, a provider of cyber security and IT network solutions supported by Rockpool, has successfully acquired Blaze Networks, a managed service provider specializing in security and SD-WAN networking technologies. This acquisition not only marks the fifth acquisition for Communicate but also represents their second strategic move since receiving private equity funding from Rockpool in June 2024. Blaze Networks, located in Macclesfield, will maintain its leadership under Managing Director Ben Brassington, ensuring continuity in operations and client relations.

This acquisition enhances Communicate's technical repertoire, particularly in designing and implementing multi-site wide area networks. The integration of Blaze’s expertise in SD-WAN (Software-Defined Wide Area Network) and SASE (Secure Access Service Edge) technologies will significantly bolster Communicate's service offerings, catering to an expanding market demand for advanced cybersecurity solutions.

Industry Overview in the United Kingdom

The cybersecurity sector in the United Kingdom has witnessed substantial growth driven by an escalating number of cyber threats and an increasing reliance on digital transformation across various industries. Organizations in the UK are increasingly prioritizing cybersecurity measures, which has created a robust market for IT network solutions and security services. The demand for managed service providers, particularly those with expertise in SD-WAN and SASE technologies, is surging as businesses seek to strengthen their network security in a remote working environment.

UK-based companies are investing heavily in cybersecurity, spurred on by regulations and compliance requirements that necessitate higher security standards. In recent years, there has been a notable shift towards adopting cloud-based security solutions, which has further contributed to the growth of the managed service provider segment and the demand for innovative network solutions.

The competitive landscape within the UK cybersecurity industry is characterized by a mix of established players and emerging startups. This vibrant ecosystem offers significant opportunities for growth through consolidation, as companies seek to enhance their capabilities and expand their market presence. Collaborations and acquisitions are common strategies to gain access to advanced technologies and skilled personnel in this fast-evolving sector.

Rationale Behind the Deal

This acquisition aligns with Communicate's strategic objective of scaling its operations and enhancing its service portfolio to meet industry demands. By acquiring Blaze Networks, Communicate gains valuable expertise in SD-WAN and SASE, enabling them to provide more comprehensive and sophisticated cybersecurity solutions to their clients. The enhanced technical capabilities will not only improve service delivery but also position Communicate as a competitive player in the growing managed service market.

Furthermore, the support from Rockpool enables Communicate to pursue such strategic acquisitions and sustain its growth trajectory. With projected turnover increasing markedly to £17 million in 2025 since Rockpool's investment, the acquisition of Blaze Networks is a vital step towards realizing this growth potential.

Investor Information

Rockpool, an investment firm that focuses on providing growth capital to mid-sized businesses, played a crucial role in financing this transaction. The firm's approach includes backing innovative companies with strong leadership and growth prospects. Led by Investment Director Tom Coey and Investment Manager Toby Hurdle, Rockpool aims to foster long-term relationships with portfolio companies, ensuring they receive the necessary support to achieve their strategic objectives.

Rockpool's continued investment in Communicate highlights their confidence in the company's growth and market positioning. By facilitating the acquisition of Blaze Networks, Rockpool is helping Communicate to consolidate its market presence and enhance its service offerings, which are essential for competing in the rapidly evolving cybersecurity landscape.

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From an investment perspective, the acquisition of Blaze Networks by Communicate represents a strategic move that has the potential for significant returns. By enhancing its technical capabilities and broadening its service offerings, Communicate is well-positioned to capitalize on the increasing demand for robust cybersecurity solutions. The projected growth in turnover indicates that the investment may yield favorable financial outcomes in the near future.

Moreover, the shift in the cybersecurity landscape towards managed services and advanced network solutions makes this acquisition particularly timely. It allows Communicate to stay ahead of industry trends and cater to the evolving needs of clients, which is critical for long-term sustainability and profitability.

However, successful integration of Blaze Networks into the existing operations of Communicate will be pivotal. Careful planning and execution will be essential to ensure synergy between the two companies, maximizing the potential benefits of this acquisition. Taking these factors into consideration, the investment can be evaluated as a promising opportunity with a clear pathway for growth and innovation.

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