SP500 Winner TekLinks Attracts New Major Investor

Top Technology Practice: Managed Services

Pamlico Capital acquired a majority interest in the solution provider from previous investor Symmetric Capital and from TekLinks management for an undisclosed amount, according to TekLinks.

"What I can say is it is a very favorable valuation, based on successes we've had in managed and cloud services," said David Powell, vice president of managed services at TekLinks, Birmingham, Ala. "We've also really been killing our numbers the past couple years. That presented itself as a great opportunity to go to market [in] a position of strength."

As part of the transaction, TekLinks said Jim Akerhielm will replace Stuart Raburn as CEO. Akerhielm has more than 20 years of experience in the IT and communications industry. He was CEO of NuVox Communications when it was sold to Windstream in 2010 for $650 million. Raburn will remain on TekLinks' board of directors, serve in an advisory role and still retain an ownership position in TekLinks following the deal, according to the company.

"Jim's track record is strong. Most [executives at TekLinks] grew up with TekLinks. Jim has big-company experience and can fill in a gap of knowledge to help [us] go from $100 million to the next step. None of us have that experience," Powell said.

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Raburn founded TekLinks in 2001, and five years ago the company brought Symmetric Capital on board to help fund growth around cloud and managed services. Now, TekLinks has three data centers and a successful recurring revenue base that is growing 40 percent a year. But to get to the next level, TekLinks executives felt additional capital was needed.

"[Symmetric] got us over the first capital hump but we reached a point where to really grow as we wanted we needed a strategic financial partner," Powell said.

With an infusion of cash from Charlotte, N.C.-based Pamlico, TekLinks plans to look at geographic expansion through acquisitions in second-tier markets as well as adding more vertical market expertise, Powell said.

"We're looking to acquire MSPs. We recognize we're going to have to pay a little premium and we'll also look at some [traditional] VAR businesses too," he said. "We'll look to coalesce into a tighter deliverable into new markets."

Akerhielm said Pamlico was attracted to TekLinks because of its success in smaller markets and a hybrid approach to service delivery.

"The company has the ability to provide quality services whether they are on premises, housed in a TekLinks-owned data center, or provisioned on their cloud-based services. This message really resonated with me, and the Pamlico team," Akerhielm said in a statement.