Fallen VAR Trinity grabbed from administration
Managed services outfit Liberata swoops in for £50m VAR following cashflow crisis
Microsoft Gold partner Trinity Expert Systems has been snapped up from administration by Liberata after succumbing to cashflow difficulties.
The Coventry-based reseller informed staff yesterday that Trinity Expert Systems Limited, Eurodata Systems Limited and TES Group Limited are now in administration and are not trading.
But, in what appears to be a pre-pack deal, its business has been transferred to Liberata IT Solutions, a provider of business and managed services that has 1,500 staff.
Trinity became one of the UK's largest Microsoft consultancies in 2011 when it merged with rival Eurodata Systems. It counts Citrix, IBM, Mimecast, Swivel, NetApp, VMware and Dell among its other key vendors.
In its last fiscal year, the combined company turned over about £47m but in a letter to staff yesterday, seen by CRN, Trinity chief executive Steve McDonagh admitted the firm had overstretched itself.
"You are all aware of our trials and tribulations over the last 18 months," he wrote.
"These as you know stemmed primarily from the cash stretch associated with our investment in the company's growth strategy particularly around the cloud."
Deloitte's Nottingham office confirmed to CRN it is handling Trinity's administration.
The contracts of employment of Trinity staff have been transferred to Liberata but its brand name will be retained, with McDonagh among the management that has agreed to stay on. Liberata said it is too early to say whether there will be redundancies but stressed it would need Trinity's sales staff to scale up its IT presence in the private sector.
The fact Trinity has gone into administration will mean some of its suppliers will not get paid but Liberata chief executive Dermot Joyce said the firm will work hard to protect its reputation in the market.
"We have a vested interest in making sure that suppliers continue to have confidence in Trinity and will be discussing with key suppliers how we can both invest in doing so as a priority," he said.
Joyce added: "While historically addressing different markets, with Liberata very much public sector focused and TES primarily a service provider to the private sector, the skillsets and capabilities are very complementary. Liberata has invested heavily in infrastructure, whereas TES has strong technical expertise.
"The combined business will be a powerful one with revenues in excess of £100m, and provide a secure and stable environment for the customers, employees and suppliers to TES."
Deloitte said in a statement that it achieved the sale following a "period of marketing", meaning other potential suitors will have been approached.
Trinity is being recapitalised with £5m investment and working capital, it added.
Matthew Cowlishaw, partner at Deloitte - who is one of three joint administrators - said: "The group's underlying business is sound with a strong customer offering and future potential. It therefore attracted a large amount of interest from both private equity and trade buyers during the sales process. The sale secures the future of the business, its employees and provides the best outcome for creditors."