KCOM sells IT services business to MSP Nasstar

Acquisition will provide 'substantial scale' and 'new capabilities' to Nasstar's offering, company says

Comms and IT services provider KCOM has sold its national ICT services business to UK-based MSP Nasstar, the company has announced.

It will allow KCOM, which has a network of over 700 partners and resellers, to concentrate on its "core strategy as a regional provider of full fibre broadband" and grow its presence in "both retail and wholesale markets", it says.

The acquisition is expected to go through in the coming weeks and follows an "in depth strategic review" at KCOM which looked at opportunities for growth.

KCOM's IT services business, which includes managed services, hosting, connectivity, voice and projects, generated revenues of £166.6m in its year ending March 2020, down two per cent on the previous year.

"Acquiring the national ICT services business of KCOM will form a vital part of Nasstar's growth strategy, and it will be integrated into the business, adopting new, efficient, and scalable systems, and enabling customers to access an enhanced product set," Wayne Churchill, CEO of Nasstar, said.

"We recognise the value and opportunities the combination of KCOM's people, capabilities and customers from the national ICT services business of KCOM represent, and we are confident our strategy will turn this potential into long-term growth and success."

Amazon and Microsoft partner Nasstar, formerly known as GCI, says the acquisition will make it one of the largest independent providers of managed services in the UK, with over 1,000 employees across the country.

It adds that the move will provide the company with "substantial scale" and "new capabilities" in certain areas, including "enhanced voice and connectivity services and cloud expertise".

KCOM's wholesale and retail operations in Hull, East Yorkshire and North Lincolnshire will remain part of its existing business.

"Our team is investing £100 million to expand our regional network, through which we are making full fibre broadband available to consumers and businesses in more towns and villages across East Yorkshire and North Lincolnshire," said Dale Raneberg, CEO of KCOM.