Managed Services Mergers and Acquisitions and MSP Valuations

Managed Services Provider (MSP) mergers and acquisitions

Managed Services Provider (MSP) valuations

Managed Services Provider (MSP) exit strategies

To alert MSPmentor about an MSP-related merger or acquisition, please email Editorial Director Joe Panettieri (joe [at] ninelivesmediainc.com).

Focus: Managed services, cloud services and business consulting in Texas, including a focus on the legal vertical.

Key Executives: The Aldridge Co. COO Patrick Wiley.

Financial terms: Undisclosed.

Focus: Photizo Group specializes in managed print services research and conferences. Lyra Research focuses on managed document services research.

Key Executives: Photizo Group CEO Ed Crowley; Lyra CEO Frank Stefansson shifts to COO of the combined company.

Financial terms: Undisclosed.

Focus: outsourceIT is a managed services provider and MSPmentor 100 company. GoBeyondIt is a cloud services provider (CSP) focused heavily on hosted desktops (VDI, virtual desktop infrastructure). Combined company has 70 employees and more than $15 million in revenues.

Key Executives: CEO Craig Guice, President Mark Vliet, Executive VP Richard Crane and Executive VP David Webb.

Financial terms: Undisclosed.

Focus: LogMeIn will integrate Bold Software’s Bold Chat customer support software with LogMeIn Rescue, the report support platform.

Key Executives: LogMeIn CEO Michael Simon; Bold Software President and CEO Steve Miller

Financial terms: $16.5 million

Focus: ePlus acquired VantiCore to extend its Cisco-related managed services business and unified communications efforts into New England (Vermont, Maine, New Hampshire and Massachusetts). The deal was announced January 9 but completed January 6.

Key Executives: ePlus CEO Phillip Norton and VantiCore CEO Vince Eugene.

Financial Terms: Undisclosed.

Focus: Xerox purchased LaserNetworks to accelerate its push into Canada with more managed print services.

Key Executives: LaserNetworks Founder and CEO Chris Stoate will lead the LaserNetworks brand under Xerox Corp.’s ownership.

Financial Terms: Undisclosed

Focus: The deal was actually official on January 1 but details emerged January 4. JMARK, based in Springfield, Mo., focuses its managed services on law firms and insurance agencies. Integris Tech of Fayetteville, Ark., has worked closely with Cisco Systems, Dell and Novell.

Key Executives: JMARK CEO Thomas H. Douglas

Financial terms: Undisclosed

Focus: This is more of a cloud services acquisition, though their are some managed services opportunities within the deal.

Key Executives: Internap CEO Eric Cooney and Voxel CEO Raul Martynek.

Financial Terms: $30 million payment, with another potential $5 million over two years if Voxel achieves certain financial results.

Focus: This deal allows Birch Communications to gain an IP network across Florida’s west coast. This is Birch’s 14th acquisition since 2006.

Key Executives: Vincent Oddo, president and CEO, Birch Communications.

Financial Terms: Undisclosed.

Focus: Best Buy gains one of North America’s largest managed services providers focused on SMB customers. The deal originally was announced in November 2011 and closed right around the New Year, MSPmentor confirmed.

Key Executives: Paul Chisholm, CEO, mindSHIFT. (The mindSHIFT team continues to run the MSP.)

Financial Terms: $167 million. MSPmentor estimates the deal’s valuation was 10 to 12 times mindSHIFT’s annual EBITDA.

Focus: This deal combines two MSPs in Ohio.

Key Executives: Canfield President George McDonnell drove 65 percent revenue growth at the six-person company in 2011 vs. 2010. Steel Valley Leader Brad Murphy joins Canfield as director of business development.

Financial Terms: Undisclosed.

Focus: This deal combined two well-known MSPs serving SMB customers in the Washington, D.C., metropolitan area.

Key Executives: Network Depot CEO Rich Forsen and Evolve Technologies CEO David Sobel

Financial Terms: Undisclosed but it sounds like the deal involves a potential earn-out to help ensure the Evolve Technologies team delivers on revenue goals and customer satisfaction goals.

Focus: The deal creates an 1,800-person MSP and IT services provider with 45 offices. The Presidio-INX combo was originally announced in November 2011.

Key Executives: Ben Patz, Presidio divisional president, is leading the integration initiative.

Financial Terms: $85 million.

Focus: This deal allowed Autotask to focus on its core SaaS platform for MSPs and VARs, while exiting the product sourcing and price quoting business involving VARStreet.

Key Executives: Autotask CEO Mark Cattini essentially unwound the Autotask-VARStreet combo that previous CEO Bob Godgart had envisioned. Meanwhile, VARStreet VP of Sales Shiv Agarwal has promised continued platform enhancements for VARs and MSPs.

Financial Terms: Undisclosed but Cattini said he was “satisfied” with the terms of the exit.

Focus: This deal allowed Dimension Data to gain roughly 500 SMB customers in Australia, Asia and the Pacific Rim.

Key Executives: Dimension Data Australia CEO Steve Nola.

Financial Terms: Undisclosed.