AHEAD To Acquire RoundTower, Kovarus, Creating $2.1 Billion Channel Behemoth

AHEAD, a solution provider focused on digital transformation services and one of Dell Technologies’ largest channel partners, Tuesday said it will acquire two other solution providers, RoundTower Technologies and Kovarus, in a move it expects to give it national reach and bring more services opportunities to customers.

Once the two acquisitions close, the result will be a nationwide solution provider with over 1,000 employees and over $2.1 billion in revenue, said Stephen Ayoub, president of the Chicago-based company.

The acquisition will make AHEAD a true IT services and sales powerhouse, according to CRN research. AHEAD ranks No. 36 on the CRN 2020 Solution Provider 500 list of solution providers, while RoundTower ranks No. 79 and Kovarus ranks No. 93.

[Related: 5 Things To Know About The Three-Way Deal Between Ahead, Data Blue And Sovereign Systems]

If the three were already a single company, they would rank No. 28 on the list, jumping ahead of such channel powerhouses as ConvergeOne, Softchoice, Consolidated Communications and ePlus Technology.

Both acquisitions are slated to close within 30 days. Ayoub declined to discuss the value of the acquisitions.

AHEAD is one of six Dell Titanium Black partners in the U.S., making it one of that vendor’s largest channel partners, Ayoub told CRN. The company is also a large ServiceNow channel partner, and is a large partner with the major cloud providers including Microsoft Azure, Amazon Web Services and Google Cloud Platform, he said.

“After the acquisitions, our cloud services practice will be close to $60 million,” he said. “That’s only for the cloud services. It doesn’t include selling the cloud, which for us is part of our product business.”

RoundTower and Kovarus, which are highly profitable solution providers, add heft to AHEAD’s cloud and ServiceNow practices, Ayoub said.

All three have in common large practices with a number of strategic vendor partners, including Dell, VMware and Cisco Systems, he said. “From a culture and go-to-market perspective, there’s a lot of alignment with these three vendors.”

Cincinnati-based RoundTower also brings AHEAD a big geographical expansion with offices in Louisiana, Florida, North and South Carolina, Texas, Massachusetts and New York, while San Ramon, Calif.-based Kovarus gives AHEAD a solid West Coast presence, Ayoub said.

“Before this, the farthest west we were was Texas,” he said. “Now we’re expanding to the West Coast. As we aspire to be a national footprint solution provider and continue our alignment with Dell Technologies, Cisco and other vendors, we feel that a presence on the West Coast is critical to our continual growth in an area we feel was underserved by solution providers focusing on solving complex problems.”

Kovarus also brings to AHEAD a West Coast cutting-edge customer base and a close relationship with the emerging technology segment, he said.

The CEOs of both RoundTower and Kovarus will join AHEAD, and the executive leadership teams are expected to stay as well, Ayoub said. Details about titles and how the teams will integrate have yet to be worked out, he said.

Ayoub said it was fortunate that the top leaders of AHEAD, RoundTower and Kovarus knew each other well before the acquisition talks started given the impact the COVID-19 coronavirus pandemic has had on travel.

“The leadership had a long relationship and a lot of respect for each other,” he said. “The deals were done without personal meetings. Everything was done via [Cisco] Webex, and the documents were signed with ‘wet ink’ and exchanged via FedEx.”

Neither RoundTower nor Kovarus cast a wide net to look for potential acquirers, Ayoub said.

“But as the markets continue to change, solutions get more complex,” he said. “We realized there’s value in scale in being able to provide unique services and solutions, and that by coming together we can collectively provide additional services and help our vendor partners scale to new markets.”

AHEAD in its current form was formed last October when the company and two other smaller solution providers, Data Blue and Sovereign Systems, merged into a $1.3 billion solution provider and one of Dell’s largest data center partners under the ownership of Court Square Capital Partners, a New York-based private equity company.

Ayoub was previously the founder and CEO of Data Blue.

Early this month, AHEAD was acquired by another private equity firm, New York-based Centerbridge Partners.