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Today, Hilbert received an acquisition offer for his company from a national IT services company, which he does not want to name. The offer is flattering and seductive, with the promise of a cash payout.
"M&A is very hot right now," Hilbert said. "There are a lot of companies looking to consolidate MSPs."
Mergers and acquisitions have picked up, with larger MSPs such as cloud services provider GreenPages Technology Solutions, Kittery, Maine, extending its geographic reach and technical expertise by buying Atlanta-based cloud MSP LogicsOne, while Cloud Sherpas, a Google partner, merged with GlobalOne, a top Salesforce.com integrator.
The consolidation trend is undeniable, as it is becoming increasingly challenging for small solution providers to prosper.
"They offered five times our profit from last year. They would give $3.5 million in cash and $1.5 million in future profits," Hilbert said.
The offer was tempting, but Hilbert said wants to maintain control of his company.
"I would have had to give up ownership. They take 55 percent of the business, but we keep working. It sounds good, but when you drill down to it, you give up everything you're working for," Hilbert said.
While the buyout offer was enticing, another business deal involving his wish to expand his data center is making more sense, Hilbert said. To solve his need for a larger facility, Hilbert now said he's in talks with national telecommunications company DynaLink.
Based in New York, DynaLink offers integrated voice and data services over VPN, MPLS, T1 and POTS lines. Hilbert sees DynaLink as offering just the right services, with a large upside for future growth.
"Dynalink is a telco provider, a reseller for T1, Internet and private lines," Hilbert said. "They realize the telco industry is diversifying, so they are interested in offering services. They built a data center a year ago. Now they want to diversify.
"They are willing to buy the hardware. They have a data center, so they could save us substantial costs," Hilbert adds. "They are a national seller and they could resell our desktop services. It's an interesting opportunity for us."