Epiris agrees GBP £1.015 billion cash deal for Gamma

Private equity firm Epiris has agreed to acquire business communications provider Gamma in an all-cash transaction that values its fully diluted share capital at about GBP £1.015 billion.

The deal will see Epiris-controlled Bradbury Bidco pay GBP £11.20 for each Gamma share. The transaction implies an enterprise value of about GBP £1.079 billion.

The offer represents a 53% premium to Gamma's GBP £7.32 closing share price before the company entered an offer period. It also represents a 55% premium to the volume-weighted average price between Gamma's 2025 financial results and the start of that offer period, and a 41% premium to the one-month volume-weighted average beforehand.

Gamma's directors intend to recommend unanimously that shareholders vote in favour of the transaction. Barclays and Q Advisors have advised the board on the financial terms and consider the terms fair and reasonable, taking account of the directors' commercial assessments.

Directors holding Gamma shares have given irrevocable undertakings covering 114,824 shares. That represents about 0.13% of Gamma's issued shares excluding treasury shares.

The board assessed the cash offer against Gamma's prospects as an independent listed company. It considered the company's market positions, cash generation and potential growth opportunities, alongside the risks involved in delivering its strategy.

Gamma had received inbound interest from several parties. The board considered proposals for the entire group as well as offers for individual parts of the business. It rejected proposals that it considered did not adequately reflect Gamma's value and prospects. Following further discussions, it concluded that Epiris offered the most attractive available combination of value, certainty and deliverability.

"Gamma has built a leading position in European business communications through sustained investment in its products, technology, people and customer relationships. The Board remains confident in the Company's strategy and long-term prospects. The Board has nevertheless concluded that the Acquisition provides Gamma Shareholders with attractive and certain value in cash. Having considered the terms of the Acquisition carefully, the Board intends unanimously to recommend it to Gamma Shareholders.," said Martin Hellawell, Chair, Gamma.

Epiris plans to continue investing in Gamma's product portfolio and increase its focus on sales execution and artificial intelligence adoption after taking the company private. Gamma's main product categories cover calling, cloud communications and connectivity.

The buyer intends to conduct a detailed strategic review after completion. That process is expected to take about six months and will examine Gamma's operations, product portfolio, investment priorities and business plan.

Areas under review will include the performance of existing products, possible acquisitions and disposals, operating efficiencies and spending associated with Gamma's status as a listed company. Epiris also plans to assess opportunities for organic and acquisition-led growth.

Gamma generated revenue of GBP £645.8 million in its 2025 financial year, alongside gross profit of GBP £348.2 million and adjusted EBITDA of GBP £141.7 million. Recurring revenue accounted for 89% of group revenue, while adjusted cash conversion was 93%.

The company serves small and medium-sized businesses through a network of channel partners. It also sells directly to larger enterprises and public-sector organisations. Gamma has operations across Europe, with established positions in the UK and Germany.

Epiris and Bidco do not intend to make a material reduction in Gamma's overall headcount or materially change employment conditions during the first 12 months after completion.

Some functions linked specifically to Gamma's listed-company status are expected to be reduced or repositioned once the business becomes privately owned. This could affect roles in those areas. Existing contractual and statutory employment rights, including pension rights, are expected to be maintained in accordance with applicable law.

Epiris does not plan material changes to Gamma's fixed assets, headquarters functions or operating locations, other than changes related to listed-company functions.

The transaction will be funded through a combination of equity and debt. Equity financing will include commitments from Epiris funds, HarbourVest, Limewood Capital and Ares funds. Ares will also provide debt financing. Goldman Sachs has confirmed that Bidco has sufficient cash resources to meet the acquisition consideration.

The acquisition is expected to be implemented through a court-sanctioned scheme of arrangement. It requires approval from a majority in number of voting scheme shareholders representing at least 75% of the value of shares voted. Gamma shareholders must also approve the resolutions required to implement the scheme.

The deal also requires antitrust approvals in Germany and Austria, as well as foreign investment clearances in Australia, Germany, Spain, the Netherlands and the UK. Subject to the required approvals and other conditions, Gamma and Bidco expect the acquisition to complete during the first half of 2027.

Once the transaction becomes effective, Gamma is expected to cancel its listing and trading on the London Stock Exchange and re-register as a private company.

"Gamma is a complex and highly resilient business, with strong market positions in the UK and Germany and a growing presence across Europe. Epiris has followed the company, and the wider telecoms sector, closely for a number of years, and we are excited to work with Gamma's management team to continue its growth as a private company. We believe that the Acquisition represents a compelling and deliverable offer which provides Gamma Shareholders with certainty of value. We are delighted to have the support of HarbourVest and Limewood Capital as co-investors in this transaction.," said Ian Wood, Partner, Epiris.