In March 1991, Cinven led the management buy-out of Azlan from its parent Logitek.
Azlan was a distributor of innovative, high margin products in the networking, communications and peripherals segments of the IT sector. Its sales were dominated by branded software and local area network related equipment sold to dealers and substantial original equipment manufacturers. Established in 1986, the company was highly cash generative, increasing sales at an annual compound rate of 50%.
Azlan presented an opportunity for Cinven to assist an experienced management team buy a high quality business. The business offered scope for rapid growth in sales through further geographic expansion and the prospect of acquiring additional distributorships against a background of projected growth in the market for network related technology. It was envisaged that Cinven would achieve an exit either through a trade sale or by flotation.
The growth in sales exceeded expected forecasts and in March 1993 the high level of cash generated enabled an early redemption of the company’s preference shares. In November the business was floated on the London Stock Exchange and final exit from the business took place in April 1996.
Multiple returned on investment: 9x