Konica Minolta’s Buyout of IT Weapons
Konica Minolta Business Solutions (Canada) Ltd. — perhaps better known by its All Covered brand with the MSP and IT services crowd — acquired IT Weapons Inc. today. It marked the sixth IT services acquisition that Konica and All Covered have announced this year. Here’s a look at the deal list.
Konica-IT Weapons: Behind the Deal
All Covered has spent more than a decade acquiring IT service providers across the U.S. When Konica acquired All Covered in early 2011, I openly wondered if Konica would halt All Covered’s M&A strategy. They didn’t.
Of the M&A deals, Konica’s buyout of IT Weapons — based in Ontario — is the first outside of the United States. IT Weapons will operate as a subsidiary company under its own name and current management team, though I do wonder if IT Weapons will take on the All Covered brand somewhere down the road. Overall, Konica Minolta’s IT services business now has more than 1,000 employees across North America.
Konica-IT Weapons: IT Services M&A Deal Value?
Konica Minolta and IT Weapons did not disclose financial terms of the deal. But if I had to guess, I suspect Konica paid somewhere around 6 times EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization).
That 6X EBITDA figure is based on IT services M&A metrics tracked by Paul Dippell, CEO of Service Management Inc. Dippell is a former All Covered employee who used to be involved in the company’s M&A dealing. I haven’t contacted him about the Konica-IT Weapons combination; he mentioned 6X multiple as an industry average during a conference keynote about two weeks ago.
Konica-IT Weapons: More Insights
ChannelE2E will update this article with more insights after we’ve had a chance to speak with the key players in the deal.