Mergers and Acquisitions, CSPs, MSP, VAR

10 MSP Mergers and Acquisitions (And More) This Week


Merger and acquisition activity involving VARs, MSPs, CSPs and data center providers continues at a frantic pace this week. The buyers include a mix of private equity firms, publicly held service providers and privately held companies. Among the 10 deals we've been tracking in recent days...

1. TekLinks acquired Nashville-based Guidant Partners, a privately-owned IT planning and management firm that provides scalable IT infrastructure service to SMB customers. TekLinks is one of the rare IT services providers that has successfully blended VAR, MSP and CSP solutions.

2. Information Services Group confirmed plans to acquire Alsbridge for $74 million in cash, stock and debt. The deal pushes ISG deeper into IT vendor management services — helping customers, for instance, to get their recurring OpEx spending under control.

3.  Globalgig acquired Velis4, which specializes in hosted VoIP phone, SIP trunking, hosted call center and hosted Skype for Business services. We’ll share more details soon.

4. Equinix acquired Verizon’s data center business for $3.6 billion. The move extends Equinix’s network and cloud connectivity platform, essentially allowing channel partners to build hybrid clouds that extend from on-premises gear to data centers to public clouds like Amazon Web Services. Verizon has been seeking to sell the data centers since early 2016 because the company failed to keep pace vs. AWS and Microsoft Azure. Instead, Verizon will double down on its network services business.

5. KKR acquired Optiv Security for roughly $1.9 billion, according to ChannelE2E’s sources. Optiv claims to be the latest pure-play IT cybersecurity solutions provider. Optiv had pursued an IPO in November, but ultimately shifts from one private equity owner to another.

6. GoDaddy acquired Host Europe Group for $1.79 billion. That deal also had been rumored since November. GoDaddy has been doubling down on SMB-focused hosting, cloud and SaaS applications. HEG gives GoDaddy a major European footprint. The company has also named a channel chief in recent days and is pushing into specialized developer niches like WordPress.

7. TDC acquired Adactic, an Office 365 channel partner in Denmark. Terms were not disclosed. Adactic is backed by a former Microsoft manager who previously helped to shape the software giant’s cloud strategy in Denmark.

8. Consolidated Communications acquired FairPoint for $1.5 billion. That deal focuses on national fiber optic networks, data centers and associated managed services.

9. ePlus acquired Consolidate’s IT services arm, which has deep Cisco Systems partner expertise in the Minneapolis, Minnesota area.

 10 & 11: M/C Partners acquired Thrive Networks and Corporate IT Solutions, creating one of the largest managed services providers (MSPs) in the northeast, the buyer claims. The combined company will be called Thrive Networks, according to a deal confirmation today

Worth Repeating

As we've reported, IT vendor deals also could be coming. ShoreTel has been seeking strategic alternatives  since August 2016. Avaya also has been seeking a potential buyer since May 2016 though bankruptcy rumors are swirling around the company.

December is typically a busy time for technology mergers and acquisitions. Tax considerations and New Year business strategies figure prominently into the timing of many deals.

Thanks to aging baby boomers, the overall M&A activity within the IT channel should continue to rise at least through 2022 or so before beginning to cool off dramatically around 2025 or so.

More: Track all VAR, MSP and CSP mergers and acquisitions by visiting the ChannelE2E Milestones section daily.

Joe Panettieri

Joe Panettieri is co-founder & editorial director of MSSP Alert and ChannelE2E, the two leading news & analysis sites for managed service providers in the cybersecurity market.