PCM Accelerates Cloud Push With Purchase of $4.1M Microsoft Gold Partner

PCM bought a $4.1 million Microsoft Gold partner to boost its capabilities around Azure, Office 365 and the Enterprise Mobility Suite.

The El Segundo, Calif.-based company, No. 28 on the 2016 CRN Solution Provider 500 list, said the acquisition of Calgary, Alberta-based Stratiform will strengthen its ability to provide cloud strategy, advisory, on-boarding, migration and management services. PCM paid $1.56 million for Stratiform up front, and the company will be eligible for a $1.3 million earn-out over the next three years.

"The addition of Stratiform to the PCM family of companies reinforces our position as a leader of enterprise cloud solutions and services," Frank Khulusi, PCM's chairman and CEO, said in a statement. "We are thrilled to add the extremely talented Stratiform team to our Microsoft solutions focus, enhancing our Azure Cloud organization with new and innovative capabilities."

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Stratiform will serve as the cornerstone of PCM's strategic cloud practice, with the company planning to bring its cloud expertise from Canada into the U.S. and other new markets. PCM's SMB, midmarket, enterprise and public sector segments will all benefit from the acquisition, according to the company.

"This acquisition represents an opportunity to accelerate our growth plans and expand the Stratiform brand and presence throughout Canada and the United States," Jordan Byman, Stratiform president, said in a statement. "By leveraging PCM's extensive customer relationships and operational scale, we can help even more customers transform their organizations."

PCM executives were not immediately available for additional comment. The deal closed Dec. 29 and is not expected to have a material effect on PCM's bottom line. PCM's stock is down 0.9 percent in trading Tuesday to $22.30 per share.

Stratiform was founded in 2012 and employs between 11 and 50 people, according to LinkedIn. The company has piloted a "build your business from the cloud up" consultative approach that gives customers the flexibility to run some applications on-premise while moving others to the cloud.

Stratiform is a Microsoft Gold partner for devices and deployment, cloud productivity, cloud platform and midmarket solution provider, and a Microsoft Silver partner for hosting and small and midmarket cloud solutions.

The company offers professional services focused on designing, planning and implementing Microsoft solutions; managed services for Office 365, Azure, server management and the service desk; and flexible cloud solutions to businesses with 150 or more employees.

For clients with fewer than 150 employees, Stratiform offers cloud solutions focused on Azure VMs, backup and RemoteApp, as well as Office 365, InTune, OneDrive for Business, SharePoint and Logic Monitor; support solutions for cloud, help desk and project delivery; and a full demo environment that allows small businesses to see Microsoft cloud solutions in action.

The tuck-in purchase of Stratiform follows three massive acquisitions by PCM in 2015: the $800 million North American business-to-business assets of Systemax, including its coveted TigerDirect brand; $393 million solution provider En Pointe; and $111 million Canadian MSP Acrodex.

PCM's fortunes have taken off since these deals closed, with the company's stock now trading 297 percent higher than its February 2016 per-share purchase price of $7.48. PCM's stock had traded at below $20 per share between February 2005 and July 2016.

The company's sales in the most recent quarter climbed 44 percent to a record $584.9 million due to strengths around advanced solutions, public sector and larger accounts. Meanwhile, PCM's net income came in at $53 million, or 43 cents a share, compared with a loss of $785,000 during the third quarter last year.