Executive Summary
Everest Asset Group (EAG) is an investment firm with a strategic focus on the consolidation of IT and Cybersecurity firms. The company's objective is to structure these firms into a unified group, targeting a London IPO in 2026-7. EAG has identified 29 profitable targets with a combined Net Asset Value (NAV) of nearly £1 Billion. The company's vision is to create a mid-market group of IT/Cyber firms through acquisition, with an exit strategy for investors via an IPO on LSE-AIM in 2027-28.
Detailed Analysis of Top Three Target Firms
Firm 1: CyberSecure Ltd.
· Sector: Security
· Market Position: CyberSecure Ltd. is a leading provider of cybersecurity
solutions, with a market share of 15% in the UK market.
· Purchase Price: £7.5 million
· Current NAV: £2 million
· Post-revaluation NAV: £47.7 million
· Growth Prospects: The company is projected to grow at a CAGR of 18% over the next five years.
· Gross Revenue (Annual): £28 million
· EBITDA: £2.7 million
Firm 2: IT Solutions Inc.
· Sector: IT Services LLC
· Market Position: IT Solutions Inc. is a prominent player in the IT services sector, specializing in cloud services and digital transformation.
· Purchase Price: £9.6 million
· Current NAV: £4.5 million
· Post-revaluation NAV: £54.1 million
· Growth Prospects: The company is expected to grow at a CAGR of 20% over the next five years, driven by the increasing demand for cloud storage and digital transformation services.
· Gross Revenue (Annual): £27.5 million
· EBITDA: £3.05 million
Firm 3: CyberGuard Plc.
· Sector: Cybersecurity
· Market Position: CyberGuard Corp. is a pioneer in the field of cybersecurity, with a strong focus on AI-based threat detection and mitigation.
· Purchase Price: £2.5 million
· Current NAV: £1.1 million
· Post-revaluation NAV: £17.8 million
· Growth Prospects: The company is poised for a growth rate of 22% CAGR over the next five years, propelled by the increasing need for advanced cyber-solutions.
· Gross Revenue (Annual): £7 million
· EBITDA: £0.5 million
Remaining Target Firms
The remaining 26 target firms are also profitable entities within the IT Services and Cybersecurity sectors. They contribute to the extant NAV of £21 million and gross revenues of £82.5 million per annum. The average EBITDA of these firms is 11.1% of revenues. The Post-revaluation NAV: £817.8 million
Risk Management
The risk associated with management changes post-acquisition is mitigated as the management team of each target firm has agreed to remain in place to benefit from the IPO. Further, EAG employs an AI system to track and monitor performance, providing strategic and tactical business advice related to marketing, sales, operations, finance, people, and quality. The management team is incentivized with stock options tied to performance, and acquisition costs are paid in tranches to minimize the risk of the management team departing. Legal and HR-related risks are covered by agreed-upon warranties. These measures ensure a balanced risk profile for potential investors.
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