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Konica Minolta Business Solutions has acquired All Covered, a member of CRN's 40 Most Innovative MSPs for an undisclosed amount, according to both companies.
All Covered will keep its name and become a division of Konica Minolta Business Solutions, as that vendor looks to expand its managed print services business into a broader managed IT services portfolio, said Rick Taylor, senior executive vice president and COO of Konica Minolta Business Solutions.
"This is the culmination of the direction the company is trying to head. This allows us to help customers with every aspect of their IT system," Taylor said. "We want to manage the information workflow from hard copy to storage and retrieval, the whole lifecycle of information."
All Covered, based in Redwood City, Calif., totaled about $60 million in sales last year in 22 cities, according to Konica Minolta. The vendor's goal is to acquire more MSP business to expand geographically and create a local presence nationwide to both end users and to its channel dealer base. Taylor hopes to grow Konica Minolta's managed IT business by 100 percent over the next 12 to 18 months, he said.
"It's an $18 billion managed IT market but it's very fragmented. This gives us the opportunity to enter the business in a big way. It gives us a strong platform to grow from," Taylor said. "There are synergies available by selling these services both direct and through our indirect channel to the 200,000 SMB customers we have today."
Todd Croteau, CEO of All Covered, said the acquisition by Konica Minolta will help the company more quickly achieve the growth the MSP wants over the next several years. "We recognized that to get the next level you need critical mass and we just can't get there the next 10 years doing it the way we were doing it. With Konica Minolta, there's a huge SMB client base and we think we can work very well to find synergistic solutions for all our customers," Croteau said. "We were not aware of anyone with the scale of Konica Minolta in this space. We're excited to have all these resources behind us."
Konica Minolta has a vision of a broad slew of services not just managed IT or print services but also into vertical markets, Croteau said.
All Covered becomes the third member of CRN's 40 Most Innovative MSPs to be involved in an acquisition the last two days. On Wednesday, mindShift agreed to purchase Alpheon in a merger of two mega MSPs.
On Thursday, Croteau echoed MindShift CEO Paul Chisholm's sentiments that the MSP market is so fragmented and the business model so unique that it is difficult to achieve scale organically.
All Covered has completed 16 acquisitions itself over the last three years, Croteau said. Last year, the MSP hired an investment banker to help find a buyer, said Taylor. The firm identified 57 prospects, which was then whittled down to three finalists, Taylor said.