Presidio Goes Private: BC Partners Acquires IT Solutions Provider for $2.1 Billion

IT solutions provider Presidio has been acquired by London-based private equity firm BC Partners in an all-cash transaction valued at $2.1 billion.

The agreement outlines that Presidio stockholders will receive $16 for each share of Presidio common stock they own, which represents a 21.3% increase over the company’s closing stock price Tuesday of $13.19 per share, and an 18.3% increase over the company’s 60-day volume-weighted average share price leading up to the announcement.

Presidio’s Bob Cagnazzi

“We believe this transaction will provide immediate and substantial value to Presidio stockholders, while providing us with a partner that can add strategic and operational expertise to our business, with a focus on executing our long-term strategy,” Presidio CEO Bob Cagnazzi said in a statement.

This acquisition is happening just two and a half years after Presidio completed its initial public offering, a rarity in the ITSP world. The Cisco Systems solution provider and close Dell EMC and VMware Cloud on AWS partner has certainly made its mark in recent years, nudging its way into the MSP, cybersecurity and digital solutions markets and becoming powerhouse among the world’s Top 100 MSSPs, according to MSSP Alert.

The deal is expected to close near the end of the year, at which time Presidio will go private. The agreement does include a 40-day “go shop” period, which essentially gives Presidio the freedom to accept a better, more lucrative offer should one be brought to the table.

This acquisition sheds an interesting light on what’s going on in the private equity/IPO/M&A arena. With BC Partners stepping in, a company that has its hands in all sorts of IT pies, what does this say about the industry and the maturation it’s going through?

The 2112 Group’s Larry Walsh

“The private equity segment is looking for businesses that have strong growth opportunities through which they can foster accelerated returns on their investment,” says Larry Walsh, CEO and chief analyst, The 2112 Group. “Too much is often read into private equity investments, such as BC Partners’ acquisition of Presidio. From an industry perspective, the buyout reflects the strong valuation that a diverse and vibrant company like Presidio can command. And, a firm like BC Partners can bring investment that will further the growth of a company like Presidio.”

Even with that said, it would be a mistake to speculate that BC Partners will implement sweeping changes to the operating model that made Presidio successful. Further, it’s unlikely that Presidio will become part of some roll-up strategy with other technology companies in the BC Partners’ portfolio. “The acquisition is what it is: A solid investment opportunity in a company that shows promising potential for a return on investment,” adds Walsh.

This deal continues the major uptick we’ve seen in private equity spending across the IT channel. It will be interesting to track the trend of investment firms scooping up or rolling together MSPs and solutions providers to acquire different, more varied areas of expertise.