Mergers and Acquisitions, Enterprise, MSP, Content

ConvergeOne Acquires Advantel Networks; Gains West Coast Reach

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ConvergeOne Holdings, which provides collaboration and technology solutions to Fortune 500 companies, has acquired Advantel Networks to extend its managed services reach across the West Coast. Financial terms were not disclosed.

Advantel, founded in 1984, is a solutions integrator and MSP headquartered in San Jose, California. The company provides collaboration solutions and services like security, data centers, storage and virtualization, unified communications, contact centers, cloud and integrated, and managed services to business worldwide.

Advantel has been busy on the partner front. The company in August unveiled relationships with 8×8 Inc. (cloud phone, meeting, collaboration and contact center solutions) and Bigleaf Networks (SD-WAN and application prioritization services). And earlier that month, Advantel partnered with ethosIQ, a data collection and analytic solution provider.

Mark Ritchie
Mark Ritchie

John McKenna, Chairman and CEO, ConvergeOne

The Advantel acquisition boosts ConvergeOne as a provider of multivendor collaboration technologies, support, and services, according to Chairman and CEO, John A. McKenna Jr. "Advantel's highly skilled employees and committed customer base on the West Coast expands our presence from San Diego to Vancouver, a key area of opportunity for us going forward,"McKenna said.

Added Advantel President Mark Ritchie in a prepared statement:

"On behalf of my employees, we are thrilled to join such a successful team. For over thirty years, Advantel has worked with small businesses and Fortune 100 enterprises to reduce their infrastructure costs and simplify IT administration. Our quality professional and managed services support is a natural fit with ConvergeOne's existing growing services portfolio and delivery base."

Under terms of the deal, Advantel will now be known as “Advantel, a ConvergeOne Company.”

ConvergeOne: In Acquisition Mode

ConvergeOne has more than 10,000 customers, including 62 percent of the Fortune 100 and 48 percent of the Fortune 500. The company's revenues were $391 million for its Q2 2018 ended in June. Collaboration revenue ($257.2 million) represented nearly 66 percent of that total. The company had a GAAP net loss of $7.5 million for the quarter.

Organic year-over-year revenue comparisons are somewhat tricky to track since much of ConvergeOne's growth has involved M&A deals. Indeed, Advantel is ConvergeOne’s 18th acquisition since 2005.

In February, the firm bought Arrow Electronics’ Systems Integration business, which specialized in unified communications, contact center, and voice and data technologies.

Other recent deals have included Alexander Open Systems, Strategic Products and Services, and Annese & Associates.

Additional insights from Joe Panettieri.