Even as the year marches to its end, M&A activity in the channel continues unabated. The most recent involves Advanced Technology Services (ATS) acquiring Innovative Technology Solutions (ITS). Financial terms were not disclosed.
ATS is a global manufacturing services and IT solutions provider operating since 1985; the company has 400 employees across the U.S., U.K., and Mexico. By contrast, ITS offers managed services and technology consulting to customers in New York, New Jersey and Florida.
The two firms will operate independently with their current workforces and brands, but the deal will create new opportunities for each business, the duo said in a press release. For instance, ATS customers will gain access to ITS’ technical support team, while ITS can tap into ATS's business infrastructure to further scale. "The acquisition is a perfect fit for both companies," Advanced Technology Services CEO Jeff Owens said in a statement.
For the future, ATS and ITS are each looking to leverage supply chain and partner network advantages to improve operations and enhance customer service.
M&A activity in the channel is never surprising at the end of the year -- especially for tax purposes, setting annual earn out goals and other variables. But the activity has been especially intense this year. Among the deals I've tracked:
PS: ChannelE2E's team has tracked more than 100 M&A deals this year...
Private equity firms also are scouring the MSP, CSP and VAR markets for potential targets. But as Service Leadership CEO Paul Dippell explained in a recent ConnectWise webcast, rapid M&A activity means well-scaled MSPs with decent profit margins are becoming harder to find. That’s causing some smaller firms to roll their operations into a larger company in order to eventually attract those private equity bids.
