Disciplined Shopping

Late last month, Logicalis said it would buy Alliance Consulting’s Southwest region business to enhance its Contract Consulting Services Group. Although terms weren’t disclosed, it is estimated that the deal will buoy Logicalis’ annual revenue to approximately $500 million. Specifically, the additional 70 or so consultants Logicalis gains will contribute to its ability to provide staff augmentation services, an area that Ingram Micro and others also are targeting for growth.

Last week, I spoke with two very different solution providers on shopping sprees of their own. The first, FishNet Security, is casting about for acquisition targets that will help it become a nationwide IT security solution provider. Currently, the Kansas City, Mo.-based company has around 200 employees in 18 locations, generating about $125 million in annual revenue, representing vendors such as Check Point, Internet Security Systems and RSA Security. Aside from extending its geographic reach, its latest purchase, SiegeWorks, fills a gap in training capabilities, according to FishNet CEO Gary Fish. He believes his next catch, for which the net has already been thrown, will bring the company into the $200 million range with 300 staffers.

Core Business Technology Solutions of Indianapolis (which used to be known as Convergence Technologies) is another acquisitive solution provider aiming for the $200 million mark in the next 12 months, about double the revenue produced by the company created through its latest merger. Its goal is to provide deeper capabilities in converged communications within the Northeast. The latest combo, for example, boosted the company’s status as a Cisco partner from Silver to Gold.

Executives for both FishNet and Core Business cite accounting discipline as absolutely fundamental to their successful M&A engagements—for both the acquirer and the to-be-acquired. As the shopping spree continues, creating more solution providers in the $100 million to $200 million range, which side of the transaction will you find yourself on?

What’s your opinion of the recent M&A activity? Send your thoughts to HEATHER CLANCY, Editor at CRN, via e-mail at [email protected].