Network Depot has acquired Evolve Technologies, MSPmentor has confirmed. The New Year deal combines two well-known managed services providers (MSPs) that support SMB customers in the Washington, D.C., metropolitan area. Here are the initial details.
Under terms of the deal, Network Depot takes on Evolve Technologies' staff and will continue to serve Evolve Technologies' customers. Evolve Technologies CEO Dave Sobel and Network Depot CEO Rich Forsen have indicated that the deal was finalized on December 31, 2011. Chatter about the potential deal emerged about a week or two ago, when Evolve Technologies informed its staff and customers about Network Depot acquiring Evolve.
Financial terms of the deal were not disclosed, but it sounds like the agreement involves a potential earn out tied to long-term revenues, profits and/or customer retention. Sobel and Forsen declined to describe specifics, but they said the deal has built-in variables that will keep Sobel and the veteran Evolve Technologies team focused on a successful M&A execution.
Behind the ScenesIt sounds like Network Depot and Evolve Technologies have had off-and-on discussions about a potential business combination multiple times -- with the latest discussions heating up at ConnectWise's IT Nation conference in November 2011. The two companies are located less than 10 miles away from each other. And their respective staff members run in similar circles.
- Forsen and his team have built both Network Depot and Virtual Administrator, a master MSP that gives VARs and resellers an on-ramp into the managed services market.
- Sobel, in addition to building Evolve Technologies, is active on the MSP speaker circuit and helped HTG Peer Groups to organize an MSP peer group in Europe. Sobel also works closely with CompTIA to educate resellers, VARs and MSPs.
More MSP Mergers, Acquisitions ComingThe Network Depot-Evolve Technologies deal kicks off the 2012 MSP merger and acquisition season -- which will certainly include a mix of small, midsize and large deals. MSPmentor is aware of a cloud-centric MSP deal that should be announced within weeks. Plus, Best Buy is expected to complete its buyout of mindSHIFT within days.
Still, not all MSPs are selling. For instance, ETG, an MSP focused on the health care vertical, recently declined multiple buyout bids in order to focus on continued growth.