ConvergeOne Acquires Microsoft, Cisco Partner AOS; Preps for IPO
ConvergeOne has acquired Alexander Open Systems (AOS), a Microsoft and Cisco Systems partner with managed services expertise. Financial terms were not disclosed. The AOS acquisition comes as ConvergeOne gears up for a merger-driven IPO in early 2018.
AOS, based in Overland Park, Kansas, has provided IT solutions in the Midwest for roughly 25 years. ConvergeOne will tap into AOS’s expertise across Microsoft, Cisco, SharePoint and Service Request Management solutions, according to ConvergeOne CEO John A. McKenna Jr.
ConvergeOne, backed by Clearlake Capital Group, has acquired multiple IT solutions providers in recent years, and the company expects to launch an IPO via merger in Q1 2018. The IPO will likely value the company at about $1.2 billion — or about roughly 8.4 times the company’s estimated 2018 adjusted EBITDA of about $144 million. That’s somewhat above the typical MSP valuation of 5X to 7X EBITDA.
ConvergeOne has more than 11,000 customers, including 57 percent of the Fortune 100 and 42 percent of the Fortune 500 across the healthcare, finance, manufacturing, education, and energy industries, the company says. In contrast, AOS is Microsoft Gold partner specializes in architecting, implementing and supporting a cloud, collaboration, data center, networking, security, virtualization, business intelligence and other types of IT solutions.
“We are excited to back the ConvergeOne team in the acquisition of AOS,” James Pade, principal, Clearlake Capital Group, LP, said in a prepared statement. “With this strategic acquisition, ConvergeOne continues to position itself as the leading provider of multi-vendor IT collaboration solutions and managed services.”