Daisy's Corporate Service Business is understood to be on the brink of a deal to combine the two businesses, which could be announced this week.
It is said that the deal would create a company with a valuation of more than £1 billion, with Daisy's Corporate Services Business being demerged from the group and absorbed into Wavenet.
That would create an MSP with more than 2,000 employees and more than 20,000 UK enterprise customers including Costain, the NHS and Transport for London.
Wavenet is majority-owned by Macquarie, which would remain the largest individual shareholder, with debt financing provided by Ares.
Under the terms of the deal, Wavenet would continue to be led by executive chairman Bill Dawson, while Daisy Group chairman Matthew Riley would join the board as a non-executive director.
Philip Grannum, chief executive, Wavenet, said, “This deal brings together two prolific consolidators, making Wavenet the largest independent managed service and security provider for large SME and corporate customers.
“It provides both Daisy and Wavenet customers greater access to enterprise grade solutions combined with the very best customer service and gives fantastic career opportunities for our employees.”
It is understood Houlihan Lokey is advising on the deal. Daisy Group did not immediately respond to a request for comment, and Macquarie declined to comment.
This follows reports last month that Daisy is nearing a £215 million takeover of cloud communications provider 4Com.