Topped the share charts on Friday following a lucrative contract announcement and is rumoured to have several more contracts in the pipeline.

Website www.coms.com

14 Jun 2013 01:55 PM

Coms aiming high with takeover plans


Firm is seeking to buy small companies after its workforce doubled during the first few months of 2013. Kate O'Flaherty talks to Paul Sweetland

Coms is on the acquisition trail after buying two businesses this year and more than doubling its workforce.

The company’s growth is spearheaded by former O-bit Telecom chief Dave Breith, who was drafted in January to revive the firm. Also key to Coms’ success is corporate development director Paul Sweetland, who joined in May 2012 after four years as MD of Obsidian Telecoms.

Coms has developed its product portfolio from a hosted switch to all things comms, including broadband and data networks. The company has grown from 17 people to 40 staff this year, with more to be recruited in the coming months.

Coms has three ‘pillars’ of the business in which it is targeting growth - acquisition, direct sales, and indirect sales. It has already built a well-defined acquisition strategy. ‘We are acquisitive and have a solid plan,’ Sweetland says.

As part of its ambitious growth plans, Coms is on the hunt to acquire a few small firms to increase its own size. ‘This will incrementally grow the size of Coms and we will then target larger organisations,’ Sweetland says.

The firm’s direct sales strategy is to target existing customers large and small with new products. Meanwhile, Coms is targeting resellers in a bid to grow in the indirect channel (see box).

But the ‘jewel’ of the company is the hosted platform, ‘which is carrier class and comparable to something like BroadSoft’, according to Sweetland. The telephony platform, called Porta One, is the tool ‘that helps us to scale indefinitely’, Sweetland adds. The firm’s plug and play, scalable VoIP solution now has between 8,000 and 9,000 users.

It works alongside a CRM interface portal called Ask Merlin. ‘They are fully integrated and both are fully scalable,’ says Sweetland. ‘The CRM platform is built specifically for telecoms and everything can be added and automated.

‘The market is consolidated now; SMEs want a telecoms provider,’ he adds. ‘We have the core platform; we call it “integrated mobile”.’

It was Coms’ acquisition of Sweetland’s former company Obsidian Telecoms’ customer base that kicked off a transformation programme that saw changes in the board and a host of new acquisitions.

Breith was introduced into the business as CEO in January, when he began to create a plan to grow the business through acquisitions. ‘The company was listed on the stock market and had no debt so it was really straightforward for us to buy other businesses,’ says Sweetland. ‘All that was done in January [2013] and it’s ongoing,’ he says, adding: ‘The volume of shares traded since Dave got in is monumentally different; that says a lot.’

In March this year, the firm bought the database and customers of World Telecom for £50,000 payable in shares. Then in May, it bought the customers and other assets of ADSL24, including almost 4,000 broadband customers - as well as its cloud based mail and hosting - for £800,000.

The firm is also involved in the Government’s G-Cloud and is accredited on G-Cloud 3 for hosted lines and Polycom.

Coms is currently working on a Government initiative to get social housing tenants onto the internet - under the “digital inclusion” programme.

Sweetland says: ‘Over time we’ll be doing more of that type of business;
we have ambitious plans.’


Coms targets resellers with Parnter Programme

Coms is utilising its Partner Programme to acquire suitable resellers and grow its presence in the indirect channel.

‘From a channel point of view it’s a land grab of as many resellers as possible with the Partner Programme,’ Sweetland says.

As the firm is streamlined, Sweetland said it is simple to join the programme, with less hoops to jump through than its rivals.

Coms’ acquisition programme makes it easy for the company to acquire customer bases, he says. ‘By default, the partner programme is also a great opportunity for us to buy resellers.’

He adds: ‘Coms are unique in that there aren’t many companies around like us – we are genuinely looking to grow via partners and acquisitions and we want partners to capitalise from our base. We make it easy for people to do business with us.’

As part of its growth drive, the company is recruiting for both the indirect and direct sales teams. Tim Loveday, head of indirect sales, and Gary Day, head of direct sales – who was previously sales director at Obsidian – are both in the process of building teams.Coms will launch a wholesale offering to the reseller channel later this year.

- See more at: http://www.mobiletoday.co.uk/Feature/25647/Coms_aiming_high_with_takeover_plans.aspx#sthash.MAP0Eq3e.dpuf

Great find Doodlebug4. If anyone is in any doubt about investing in COMS then this should finally convince them. The hyperlink did not work for me. However the following one did.

http://www.mobiletoday.co.uk/Feature/25647/Coms_aiming_high_with_takeover_plans.aspx

A personal quote from DB.

"With all these new changes happening, if you take them all as a whole and put them together, we have something really special now and the real foundations for something huge".

I like the word "huge" !

Once we get through 3p a second time it'll be onwards and upwards to 5p with plenty of news flow anticipated. I'm so glad to b in on Coms at this early stage in it's growth to a serious player in their market and a potential multiple-bagger IMO and DB also very confident with his 10p target (short term!).

Quote from David Breith during a recent interview, "COMS have some Government accreditations which will open up in the very short near future".

Latest quote from DB:

"I didn't invest or agree to run this business for it to be small..... It will be big and it will be massive. Probably bigger than I imagined it to be, honest".

Once we get though 3p. mmmmm!!!!! Heard it all before.

3 monkies

There are many reasons to be positive here? Have you not read every RNS since January? if not then you need to. Do you actually know anything about COMS?

You appear to have reasons to be pessimistic. Please share them with us and explain yourself, if you can, rather than coming out with a very negative, "Heard it all before".

3 monkies, it's just a question of when we get through 3p - not if - imo :-)

I perhaps should have looked at these in January. I haven't anything against this share we all know the markets are not good at the moment. So it is still a mmmmmm! for me.

Plenty of time to get in 3 monkies. I don't blame you for sitting on the sidelines until you're convinced the markets are back in positive mode.

Direction depends on Bennie's speech on Wednesday.

Think G Cloud Exhibition

Tuesday 18th June 2013 - Business Design Centre, Islington, London

http://thinkgcloud.com/exhibitor-list/

Of course, COMS are one of the exhibitors. It's the place to be for advertising your G-Cloud business and generating leads, which in the fullness of time will bring new business.

Interesting to note that Coms are the only exhibitor that makes any reference to Telephony or Voip in their preamble.

Taken From Megabuyte :-

News | Coms plc, Public Company (UK)

Dave Breith's Coms masterplan gathers pace

AIM-listed business telco COMS has continued its buying spree with the £1.8m acquisition of Premium O and some network assets for £0.2m, both from CEO and major shareholder Dave Breith, and another set of network assets for £0.5m, all in shares. We assess the Dave Breith masterplan.
Premium O is a specialist B2B telecoms solutions provider and network operator within the interactive communications industry, basically using premium rate numbers and network services such as IVR and SMS for voting, competitions etc. Its carrier network will boost Coms’ margin on its hosted voice inbound traffic, whilst resale of its 8m numbers will generate additional opportunities.
Coms is paying £1.8m in shares, at 3p per share (versus the closing 2.65p) for a company that generated £0.4m profit before tax on £3.0m revenues in the year to September 2012; 20% of the consideration will be deferred until Premium O has generated additional gross margin of £55k a month for at least three months. Coms CEO David Breith owns 59.5% of Premium O.
Coms has also acquired two sets of telecoms and IT hardware used in providing data networks; one from David Breith for £0.2m in shares, at 3p per share, and one from TFM Networks Ltd for £0.5m in shares, at 2.7p per share. TFM will merge and manage the networks on behalf of Coms on a five year contract.
First thoughts
So the David Breith masterplan gathers pace. Sell an existing business (O-Bit Telecom) to Daisy and bank a few quid, as well as continuing to run and invest in in other private activities. Then find a lowly valued, under-performing public listed company with some decent assets (hosted voice licences) and customers, buy a sizeable shareholding position, take over as CEO, and amalgamate the various assets (today’s Premium O and network assets, plus a previously announced customer database and AskMerlin software), plus a few others. Chuck in a major two year, £15m broadband contract, and you now have a substantial business telecoms provider. Simples!
To be fair to Breith, he is now buying his own assets at a 3p share price that is not only 13% above the closing price, but substantially above the 0.5p prior to his interest. Mind you, he has to ensure that he doesn’t end up with more than 29.9% of the company from such manoeuvres, which would automatically require a take-over offer.
In broad financial terms, he has taken a business with £1.6m of revenues and £0.8m of EBITDA losses in the year to January 2103 to one that will run at over £12m revenues for at least the next two years, and that’s before adding revenue opportunities from the data network as well as the multiple service expansions that Breith outlined to us in April. With the new shares, and this morning's 3% share price rise to 2.75p, Coms will have a market capitalisation of nearly £15m versus £1m prior to Breith’s arrival.

Just bought some of these rightly or wrongly, it showed up as a sell at 2p less than I gave for them. Exact amount of shares and time of execution - what are they doing? Makes one wonder at the end of the day why we have streaming buys and sells as they are not accurate.

Welcome onboard 3 monkies. Surely you mean 0.2p less. Another 265k buy this morning showed up in the ? column as they were bought at the mid-price. Delayed trades also help to add to the confusion.

Correct 0.2p I do get confused with my decimal points sometimes - I only bought £500 worth, that is enough for me to loose (not hopefully) if it joins the rest of my minus's at the moment. GL to you and all of us.

2.65p seems to be the buying price at the moment 3 monkies.