This is M&A deal number 447 that ChannelE2E has covered so far this year. See the complete M&A deal list here.
Pace Harmon, founded in 2003, is headquartered in McLean, Va. The company's expertise includes:
- IT optimization and outsourcing advisory;
- business process optimization and outsourcing advisory;
- enterprise software and integration advisory services;
- enterprise network services;
- strategic sourcing;
- transition management; and
- vendor management and governance.
Co-Executive Managing Directors Steve Martin and David Rutchik, who led Pace Harmon from inception, will be departing to pursue other interests. Their exits align with a Pace Harmon transition plan launched in 2019.
West Monroe Acquires Pace Harmon: Expected Deal Synergies
Among the deal highlights:
- This is West Monroe’s largest acquisition in the company's 18-year history, and third acquisition in the past 18 months.
- West Monroe is a national business and technology consultancy based in Chicago. The company has 1,400 employees.
- Pace Harmon has roughly 70 employees who will join West Monroe.
- Pace Harmon had a 25% CAGR (compound annual growth rate) since 2003, and in 2014 transitioned to a 100% employee-owned firm.
- West Monroe will finish 2020 with 13 consecutive years of top-line revenue growth and EBITDA growth.
In a prepared statement about expected deal synergies, West Monroe said:
"Combining West Monroe’s proven expertise in technology architecture, cloud advisory, business process design, and change management with Pace Harmon’s proven experience in IT function redesign, optimization, and outsourcing enables the firm to better support and lead an organization’s transformation for the post-COVID economy."
West Monroe Acquires Pace Harmon: Executive Perspectives
In a prepared statement about the deal, West Monroe Chief Operating Officer Doug Armstrong said:
“Pace Harmon’s expertise in value creation and cost takeout are both complementary and additive to West Monroe. Their depth and decades of experience in this space make them highly effective partners, and we are excited to bring our combined capabilities to market and help companies meet these challenges."
Added Pace Harmon Principal Co-Founder Steve Martin:
“Over Pace Harmon’s nearly two decades in operation, we built a solid reputation among major global enterprises as a trusted business transformation advisor with a client-first philosophy. We saw an immense opportunity to continue Pace Harmon’s successful track record in combining capabilities with West Monroe—we couldn’t be more thrilled with the outcome.
Noted Pace Harmon General Counsel David Rutchik:
"Meeting today’s enterprises’ complex IT, business transformation, outsourcing, and procurement optimization goals requires a specialized approach backed by decades of experience, and we are proud of the transformative impact we have made on our world-class client. West Monroe is positioned to offer both organizations’ collective clients even deeper value and stability moving forward.”
Concluded Tom Bolger, chief strategy officer for West Monroe:
“West Monroe will finish 2020 with 13 consecutive years of top-line revenue growth and EBITDA growth. While 2020 has certainly brought more than its share of challenges, we are addressing those challenges through several offensive measures—including seizing opportunities like this to succeed in the post-Covid economy. The strong position we’ve worked hard to build over the years will enable us to continue our tremendous growth trajectory with acquisitions and other investments that position our firm to meet the needs of our clients now and into the future.”
The deal closed on November 1. Advisors on the deal for West Monroe include BDO for financial and tax advisory and Polsinelli for legal advisory. Clearsight Advisors served as financial advisor, and King & Spalding served as legal counsel to Pace Harmon.
West Monroe Business Evolution
West Monroe has been both a buyer and seller in the M&A market. Key moves include:
- January 2020: Private equity firm M/C Partners acquired West Monroe's managed IT services provider (MSP) division.
- October 2019: West Monroe acquired GoKart Labs, a Minneapolis-based digital product studio specialist.
- April 2019: West Monroe acquire Waterstone Management Group to boost M&A consulting practices, particularly for private equity & technology company clientele.