Spotlight

An archive of past spotlight issues.

 

The martinwolf team tracks noteworthy mergers and acquisitions, and offers
commentary on issues that impact our industry. Here is an archive of past

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"Something clicked in May and we saw a rush of PE firms asking us about MSPs and MSSPs."

Surge in Private Equity Demand for Managed Service Providers

Demand for Managed Service Providers (MSPs) and Managed Security Service Providers (MSSPs) has surged to new highs as Private Equity (PE) firms continue to be attracted to the recurring revenue model.

 

Tim Mueller President martinwolf

martinwolf President Tim Mueller was cited in Karishma Vanjani’s article on PE Hub regarding the unprecedented rise in PE demand for MSPs and MSSPs. Mueller explains that the addition of security services to an MSP’s portfolio can grow recurring revenue to over 80 percent—a fact that has driven significant interest among buyers across the martinwolf and IT ExchangeNet network.

 

Deal multiples for MSPs and MSSPs continueto increase as some firms with significant recurring revenue are seeing multiples above 10x their 12-month adjusted EBITDA.

 

“Something clicked in May (2020) and we saw a rush of PE firms asking us about MSPs and MSSPs. Our email inbox just started blowing up; we asked each other ‘are you seeing what we are seeing?’” Mueller added.

 

Vanjani’s piece highlights the “dizzying rate” in which PE firms are acquiring MSPs and MSSPs. Read the full piece here, and if you have any questions about what this means for your business,contact Colin Riley.

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15 Apr 2021

KKR to Acquire Ensono in $1.7 Billion Deal

Financial Information ($USD) Enterprise Value:    $1.7 Billion Transaction Details Global investment firm KKR & Co, Inc. (NYSE: KKR) is acquiring leading hybrid IT services provider Ensono from private equity firms Charlesbank Capital Partners and M/C Partners. While financials have not been disclosed, the transaction is valued at $1.7 billion inclusive of debt, according to Reuters....

12 Apr 2021

Microsoft Acquires Nuance in $19.7 Billion Deal

Financial Information ($USD) Enterprise Value: $19.7 Billion EV/LTM Revenue: 13.97x EV/LTM EBITDA: 89.55x   Transaction Details Microsoft (Nasdaq: MSFT) today announced that it will acquire Nuance Communications, Inc. (Nasdaq: NUAN) in an all-cash transaction valued at $19.7 billion. Nuance, a speech recognition and artificial intelligence company, will be acquired for $56.00 per share, approximately 23%...

22 Mar 2021

SYNNEX Announces Merger with Tech Data

SYNNEX Announces Merger with Tech Data   Financial Information ($USD) Enterprise Value: $7.2 Billion EV/LTM Revenue:  0.20x EV/LTM EBITDA: 9.50x   Transaction Details Leading distributor SYNNEX Corporation (NYSE: SNX) today announced that it will merge with fellow distributor, Tech Data, in a deal worth approximately $7.2 billion, including net debt. The deal creates a distribution...