NWN Snaps Up Three Solution Providers

current wave of channel consolidation

NWN, a Waltham, Mass.-based Cisco Systems Gold and Microsoft Gold partner, Friday said it has bought 4Front Systems, Datanet Services Inc. (DSI) and The Datastore, the systems integration operating units of Xcelecom, a subsidiary of UIL Holdings. Terms of the deal were not disclosed.

With the acquisitions, NWN is on track to hit $120 million in sales this year, up from $40 million, said Mont Phelps, president and CEO of NWN.

The combined company has 225 employees—including 150 engineers—and an East Coast geographic reach from Maine to the Carolinas, Phelps said.

"With our Cisco position, this makes us even stronger as we move toward Master certifications. There are also our shared engineering resources—we have a big engineering pool, so that allows us to do things others can't in terms of meeting client demands," Phelps said.

The deal comes about a month after a merger between NWN and another Cisco partner, Boston-based NetTeks Technology Consultants fell through after the two solution providers failed to come to terms. The deal with Xcelecom was already under way at that time, Phelps said.

NWN will use the expansion to supplement its IP communications, networking and security practices, as all three of the newly acquired solution providers bring their own Gold-level certifications from Cisco and Microsoft. In addition, it will add a storage practice through 4Front and DSI's partnerships with EMC and expand its managed services offerings to its new geographies.

Of most significance to the acquired firms will be their access to NWN's managed services platform, executives said.

"There's a lot of movement in the market, especially in the midmarket, to fully outsource or partially outsource," said Mark Alexander, executive vice president of NWN, formerly president of both 4Front and DSI, based in Morrisville, N.C., and Greensboro, N.C., respectively. "[Customers] simply can't staff all the expertise on everything coming at them right now."

NWN Executive Vice President Pat Kopins, formerly president of The Datastore, Maple Shade, N.J., also lauded the critical mass and access to managed services that the deal will bring. In addition, the fact that the acquired companies will all share the same name and strategic vision is an exciting prospect, he said. "The idea that we will operate as one strong, cohesive company really has our employees fired up," Kopins said.