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ConvergeOne Acquires SPS
- Terms Not Disclosed
- IT services firm ConvergeOne, owned by private equity firm Clearlake Capital, announced today that it has acquired New Jersey-based Strategic Products and Services (SPS), a global, multivendor communication for unified communications (UC) and networking managed service provider. SPS will now operate as SPS, a ConvergeOne Company.
- This deal, which will be effective immediately, catapults ConvergeOne into the ranks of billion-dollar revenue solution providers.
A Leading Provider of Collaboration and IT-Enabled Solutions
Leadership Shift: Previously, SPS had been owned by private equity firm Court Square Capital Partners (martinwolf advised SPS on the transaction). The company was originally founded by John Poole, a widely respected innovator in the channel, and has grown into an 800-person practice. Current CEO Ed Nalbandian will be leaving his role, replaced by John F. Lyons, President and CEO of ConvergeOne’s Enterprise division.
Greater Scale: In addition to scale, SPS will give ConvergeOne more breadth and depth around its video offerings, especially with regards to managed services, engineering, installation, and design. The certified expertise will also bring an advantage; SPS has more than 3,000 technical certifications and several key partnerships. Its status as a Platinum Avaya Partner and Premier Cisco Partner will be especially beneficial to ConvergeOne, as Cisco and Avaya together comprise ~60% of the company’s total product sales. Since both companies focus on medium and large enterprises, the combined company will be able to maintain relationships with 300 IT vendors.
M&A Growth: ConvergeOne, which has a staff size of roughly 800 and over 7,000 customers, just last month bought IT services company Annese & Associates, now known as Annese. As a Cisco Gold Certified Partner with public cloud capabilities and 47 years in the IT space, Annese increased ConvergeOne’s presence in the northeastern U.S., and the latest transaction is a continuation of ConvergeOne’s M&A activity to achieve greater scale. In December 2015, the company purchased cloud computing and data analytics firm SIGMAnet, and in October 2015, purchased managed services and collaboration provider Spanlink.
Private Equity Power: Irvine-based Clearlake Capital, which has over $4 billion of assets under management, targets sectors in the software and technology-enabled services, industrials and energy, and consumer spaces.
For more information about this transaction, click here to read the press release.
martinwolf was not the advisor in this transaction.