XOR sells up after 2e2 collapse hits cashflow
New owner Company85 says acquisition means it can provide full range of channel services from desktop to datacentre
Symantec's former consultancy arm has stepped in to buy XOR after the channel services firm's cashflow was hit when giant integrator 2e2 hit the rocks.
XOR represents the first acquisition made by Company85, which was formed in 2010 when Symantec span out its UK and EMEA consultancy division in a management buyout.
Talking to CRN, Company85 sales director Bill Trim said the acquisition will mean the firm can provide the full repertoire of channel services, from the desktop to the datacentre, expanding its billable headcount from 60 to between 80 and 90 in the process.
He claimed there is little overlap between XOR's workspace transformation services and the security and storage professional services Company85 offers around vendors including not only Symantec but also EMC, HDS, Trend Micro, Splunk, NetApp, VMware and Gigamon.
XOR ranked as one of the UK's fastest-growing tech firms in 2012 but its finances became strained following the collapse of one of its partners, giant reseller 2e2, Trim acknowledged.
According to a document sent to creditors in March, 2e2 bit the dust owing Watford-based XOR more than £15,000.
"XOR grew very quickly and had a strong order book, which was attractive to us," Trim said. "They did suffer a bit when 2e2 went bust. We have been profitable from the get-go and have a healthy balance sheet and strong cash reserves. So there was a financial justification to this acquisition - it enables XOR to continue growing strongly and deliver on its strong order book."
XOR will be run separately, meaning partners will not be required to redo any paperwork, Trim said.
Specialising in services such as application packaging, desktop virtualisation and operating system migration, XOR operates exclusively through partners. Trim said Company 85 has a similar channel-centric culture, adding that its direct relationships with some end users would not cause conflict.
"We have a small number of direct relationships where we are brought in as a trusted adviser, to help the CIO set the agenda, perhaps writing RFPs [request for proposals]," he said. "But we are vendor agnostic and very quickly introduce [the customer] to potential partners. It's a model that sits well with the channel, as we are bringing them opportunities."
Company 85's heritage dates back to the late 1990s, when it was known as Company-i. Symantec bought the firm - which is headed up by Adrian Spink (pictured) in 2006 before spinning it off four years later following its decision to move to a partner-led services model.
In a statement, XOR managing director Premkumar Subramanian said: "This move is great news for XOR and our customers. Company85's pedigree is exceptional, and we are delighted to be working with people who are so experienced professionally and who understand the channel so well."
XOR and Company85 shared about 10 reseller customers before the deal but Trim stressed there would have been no overlap in services offered.
"One of the opportunities is for all the partners to access the combined breadth and depth of capability our two organisations can offer," he said.