Graphite Capital targets £58bn IT managed services market with Digital Space buyout

UK mid-market buyout house Graphite Capital has backed the management buyout of Digital Space from Horizon Capital.

The company provides an integrated connectivity, security and hybrid cloud managed service, underpinned by its own datacentres, core network and network operations centre.

Digital Space’s services are aimed at medium to large corporations, as well as public sector and not-for-profit bodies with 500 to 5,000 staff.

The company has 5,700 customers which across the retail, financial and professional services, manufacturing and construction, hospitality and leisure sectors.

Graphite said the addressable IT managed services market is estimated to be £58bn, with the areas Digital Space serves forecast to grow at 10% per year for the next five years.

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In the year to December 2021 the company generated revenue of £57.4m.

Graphite senior partner Humphrey Baker said, “Digital Space has the potential to be a highly differentiated player in this growing and resilient market, driven by high-quality provision of critical services to private and public sector organisations in the UK.”

Graphite is currently investing out of its £500m Graphite Capital Partners IX fund that it closed in 2018.

It typically backs companies with enterprise values of £30m to £175m.

Its recent investments include exiting scientific animation producer Random42 in a trade deal to The Lockwood Group, buying personalized children’s books publishing platform Wonderbly and scoring a 4.5x return in its second successful sale of car refinishing product manufacturer U-POL last year.

Source: Business Wire

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