Acquisition-hungry services provider Phoenix IT Group has bolstered its managed services portfolio after completing the acquisition of VAR Servo Computer Services for £30.25m.
Phoenix is hoping the acquisition of the Matlock-based IT services and equipment provider will help it steal a march on rivals in the SME sector.
Speaking to CRN, Nick Robinson, chief executive of Phoenix, said: “We acquired Servo because we want to sell IT services to the SME market.”
Servo, which has offices in various locations around the UK, is the second significant acquisition for Phoenix in 18 months, after it acquired disaster recovery specialist NDR for £37m in March 2005.
Robinson said the acquisition will allow Phoenix to use its existing skills gained through NDR and develop cross-selling and up-selling opportunities across the brands.
He added that Servo will operate as a stand-alone division of Phoenix and will keep the Servo brand name.
When asked about future acquisition, Robinson refused to rule it out.
“Our strategy is to grow the business through a combination of organic growth and acquisition – both are equally important,” he said.
David Jones, managing director of Servo, said: “Phoenix was looking to grow its group and it was looking for a way to expand its business into the SME channel. We were the perfect vehicle to help it do that.
“It’s been a very well put together deal. We now have a good opportunity to cross-sell into NDR’s customer base and accelerate our growth plans even faster.”
James Calvert, chief executive of market watcher Regent Associates, said: “The medium-sized outsourcers market is ripe for consolidation and there are only going to be a few players that reach the significant size to be able to do this. The only way to reach this size is to do it reasonably quickly through acquisition.
“I think this acquisition trend will continue for some time because consolidation has become a function of a mature IT market.”
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