The deal

Our Corporate Finance team has successfully advised UK Private Equity House, WestBridge Capital on the acquisition of Channel 3 Consulting Limited; specialists in the design and implementation of digital transformation programmes for the health and care sector.

WestBridge has invested £10 million to support the experienced management team in a management buy-out of the business led by CEO John Howard, who joined the company two years ago, and colleagues Eleanor Rollason and Lucy McLintock. The three will now lead the company following the departure of the founding directors.

Established in 2009, Channel 3 helps its clients harness the power of technology to deliver better patient outcomes, improve services and operate more efficiently. Over the past decade, Channel 3 has worked with over 90 organisations across the NHS, private healthcare, local government, the Ministry of Defence and the wider public sector. It is currently appointed to several key NHS and public sector frameworks.

The need to digitalise the NHS has been understood for many years and the challenges presented by COVID-19 have emphasised this further. Longer term, the launch of NHSX in 2019 – a collaboration between the Department of Health and Social Care, NHS England and NHS Improvement tasked with driving the digital transformation of healthcare – presents strong opportunities for Channel 3. Simon Davies and Sanj Benawra from our Corporate Finance team provided buy-side lead advisory assisting with evaluating the business and negotiations, deal structuring, an exit review, and project managing the deal through to completion.

The team worked alongside Capital Law (Legal), CIL (Commercial Due Diligence), DSW (Financial Due Diligence) and BDO (Tax) to close this transaction for WestBridge Capital. Commenting on the recent transaction Valerie Kendall, Founding Partner at WestBridge Capital commented: “Channel 3 is a great company positioned in a growing and dynamic market. With John Howard and his team at the helm over the last two years, it has embraced more strategic partnerships with its growing customer base and we are all confident that it is well placed to unlock future potential. The launch of NHSX was a clarion call for all healthcare providers to harness the power of technology to transform outdated systems and improve care for all. Partly as a result of this government initiative, the health tech market is growing rapidly and Channel 3 has the expertise to provide thought leadership to this dynamic and vital sector.”

James MacLeay, Senior Investment Manager at WestBridge Capital added: “Channel 3 represents everything we look for in a company – a strong business model with excellent client relationships in a resilient, niche and growing market, coupled with a highly experienced senior management team which is united in its ambition. We are looking forward to working with John and his team.”

John Howard CEO at Channel 3, said: “This is a landmark moment for our business, and we are genuinely thrilled to secure support from the WestBridge team, which has demonstrated a collaborative and supportive approach.

“Our growing team of consultants has impressive expertise, and we are all proud of helping our customers achieve great things with technology. The importance of what we do has been brought into even sharper focus during these challenging times. “I speak for the entire team at Channel 3 when I say we are very much looking forward to seizing the opportunity presented by WestBridge over the next few years.”

“Simon and Sanj provided comprehensive buy-side support, and ensured we got this transaction over the line. Their extensive experience and knowledge of the acquisition process allowed us to fully concentrate on any issues that arose and they professionally managed the whole process from beginning to end. They were highly responsive, and we were impressed with the quality of service they provided, which was intrinsic to the successful completion of this transaction. We look forward to working with the team again in the future.”
James MacLeay, Senior Investment Manager at WestBridge Capital.

“I would like to extend my personal thanks to Simon and Sanj who did more than their fair share of the heavy lifting to help us get the deal over the line. They were a pleasure to work with and were a huge support to the management team and myself throughout the process.” John Howard CEO at Channel 3.

“From an early stage WestBridge established a strong relationship with the management team and having built an early and thorough understanding of the business dynamics and key value drivers, were proactive throughout the due diligence phase to keep on top of the deals progression. We worked well as a team with WestBridge to ensure an efficient process, and when issues arose, we were able to deal with them jointly and quickly to provide solutions and efficiently complete the transaction in a tight timescale. We wish John, Eleanor, Lucy and the team well in their continuing journey with Channel 3, confident that they have an Investor in WestBridge that shares their vision for the future.” Simon Davies.