Virgin Media O2 (VMO2) has revealed plans to merge its business-to-business (B2B) operations with Daisy Group, a complementary entity in the communications sector. Established in 2001 by Matthew Riley, Daisy Group specializes in providing a variety of cloud, communication, and IT services to businesses throughout the UK, growing through both organic expansion and acquisitions over the last twenty years.
Merger Structure and Financials
The merger will involve VMO2 contributing an intercompany loan of around £425 million, alongside Daisy Group’s debt of approximately £835 million. This new combined entity is projected to generate annual pro forma revenues of about £1.4 billion, with VMO2 holding a 70% stake and Daisy Group the remaining 30%.
Operational Plans
The newly formed company aims to address the IT and communication requirements of a wide range of UK businesses, including small offices, SMEs, large corporations, public sector organizations, and indirect partners. VMO2 and Daisy Group are optimistic that by uniting their resources, they can enhance their scale, expertise, and focus. This collaboration will leverage VMO2’s robust fibre and mobile infrastructure alongside Daisy’s comprehensive IT management and sales platforms.
Service Offerings
The joint business will focus on providing digital-first connectivity solutions and managed services tailored for both new and existing clients. This includes cloud communications tools, 5G private networks, internet of things (IoT) connectivity, security services, and AI-driven products such as O2 Motion. VMO2’s fixed and mobile wholesale operations, which incorporate smart metering and services for mobile virtual network operators, will remain wholly owned by VMO2.
Leadership Structure
Matthew Riley will lead the new entity as chair, while Jo Bertram, the managing director of Virgin Media O2 Business, will serve as CEO. Initially, the businesses will operate under their existing brands and from their current locations.
Statements from Leadership
Lutz Schüler, CEO of Virgin Media O2, expressed enthusiasm about the merger, stating that it creates a significant British business connectivity powerhouse, enhancing competition in the market. He emphasized the scale, talent, and infrastructure required to drive digital transformation and provide comprehensive IT and communication solutions to business customers.
Matthew Riley highlighted the transformative nature of this merger, asserting that it will reshape the telecommunications and IT landscape in the UK. He reiterated the importance of world-class infrastructure to support growth, stating that the new entity aims to deliver extensive solutions to meet the evolving needs of UK organizations, backed by teams focused on superior customer service.