ConvergeOne To Buy Arrow's Systems Integration Business For $36M

ARTICLE TITLE HERE

Fast-growing solution provider ConvergeOne made another strategic expansion move this week, scooping up Arrow Systems Integration – an enterprise communications-focused subsidiary of Arrow Electronics – for $36 million, according to its SEC filings.

Buying Arrow SI will allow ConvergeOne to strengthen its foothold in the United States, broaden its collaboration and cloud services offerings and add vertical expertise in health care and government agencies at the state, local and federal levels, according to Chairman and CEO John McKenna.

"This acquisition will be an ideal addition to ConvergeOne, supporting our continued strategy to grow customer relationships by providing comprehensive solutions, services, and support," McKenna said in a statement.

[Related: ConvergeOne Purchases Star Solution Provider AOS ]

id
unit-1659132512259
type
Sponsored post

ConvergeOne expects the deal to close within 30 days of the initial announcement.

Although part of a significant IT distributor, Arrow SI provides Communications-as-a-Service, collaboration, RMM and IT service management solutions directly to enterprise customers. Arrow SI and ConvergeOne both partner with Avaya, Microsoft and Genesys.

"As part of ConvergeOne, we will leverage our combined services capabilities and expertise to meet and exceed our customers’ and strategic partners’ needs," Arrow SI President Mike Bevilacqua said in a statement.

The Arrow SI purchase announcement comes as Eagan, Minn.-based ConvergeOne prepares to go public on Feb. 21 through a special-purpose acquisition agreement with Forum Merger Corp. ConvergeOne, backed by private equity group Clearlake Capital since 2014, will join the New York Stock Exchange at an estimated initial valuation of $1.2 billion, trading under the ticker symbol "CVON."

ConvergeOne has stayed growth-hungry in the run-up to its IPO. In just the past seven months, the IT services giant has purchased three companies on the CRN Solution Provider 500: Microsoft and Cisco partner Alexander Open Systems (No. 107), New England-focused call center specialist Annese (No. 226) and networking MSP Strategic Products and Services (No. 74).

Since 2005, ConvergeOne has completed 16 different acquisitions.

Martin Wolf, president of martinwolf M&A Advisors, wrote in a December analysis that McKenna's "strong eye for strategic M&A" has ConvergeOne well-positioned for success as a publicly-traded company.

"McKenna has demonstrated how a company can continually increase in value through suitable acquisitions," Wolf wrote.