STP.L Share News (STP)

Business telecoms services group Daisy has snapped up rival Spiritel for about £27.3m.It is the latest in a long list of acquisitions by Daisy, which is focused on small- and medium-sized businesses, since coming to the market last year and the biggest so far.'The Daisy board believes that this acquisition gives Daisy a strong foothold in the mid-market, strengthening our sales team and engineering force, while significantly enhancing both our product portfolio and customer base,' said chief executive Matthew Riley.'With our data hosting capabilities from the former Vialtus Solutions Limited business, this deal gives us a great cross-sale opportunity to sell hosted solutions and fill our three data centres in London, Manchester and Fareham.'Broker Daniel Stewart described Spiritel as 'in many ways a miniature version ofDaisy itself.'According to Daisy, Spiritel is a 'consolidator of the fragmented UK telecoms seller market.'The broker notes that Daisy recently secured a £75m acquisition facility and that the Spiritel acquisition will use about half of this, which 'leaves plenty of firepower for further deals.'Speaking to ShareCast, Riley said that the Spiritel acquisition, as well increasing Daisy's exposure a to medium-sized companies, would give it greater penetration in mobile phone-related services. Its strong exposure to pub groups, such as sector giant Punch Taverns, with which it recently won a £5m managed services contract, will complement Daisy's strong position in the retail sector, he said.Riley explained that the telecoms services market is fragmented because when the sector was de-regulated about 600 regionally-based companies emerged. The increasing complexity of the market makes it more easier for larger companies to operate, he said.