Pulsant boss pledges more M&A after Spinnaker Red buy

Mark Howling tells CRN he expects to continue acquiring at least one firm a year following purchase of cloud migration specialist

Cloud hosting provider Pulsant has continued its acquisition strategy by snapping up IT services firm Spinnaker Red to boost its cloud migration and IT consultancy capabilities.

Headquartered in Wapping, Spinnaker Red delivers IT consultancy services across the entire range of IT infrastructure, to customers in the banking, insurance and legal sectors.

Founded in 2010, Pulsant offers a range of cloud services, along with datacentre hosting and managed networks.

Speaking to CRN, Mark Howling, Pulsant's CEO, said the firm was previously not fully satisfying customer demands regarding migrations to hybrid cloud environments, and for IT assessments and reviews for existing customers to optimise performance and cost.

"The managed services bit is what we do very well; that's core to us. But up till now we have not had that consultancy piece to help the customers design, scope and then run the projects and get them into our environments.

"Spinnaker Red immediately helps us fill that gap. It's [about] consultancy services, but it's increasingly important for our customers who need that help."

Following the acquisition, for an undisclosed amount, the Spinnaker Red moniker will disappear, its office in Wapping will be closed and all assets and employees will be transferred to the Pulsant team, Howling said. He added that there will be no redundancies at the firm.

The deal represents the fifth acquisition Pulsant has made, and Howling indicated that this strategy will continue in the coming years.

"We have the funds and it wouldn't surprise me if we made at least one acquisition a year for the next three or four years. They would be around various managed cloud functionality that fit well and add to our current cloud platform. We are also looking for additional geographic locations across the UK and potentially data networking skill sets and capabilities," he said.

In 2014, Pulsant was taken over by Oak Hill Capital Partners and Howling said the deal for Spinnaker Red is "absolutely in line with the strategy of bringing Oak Hill in".

He said the ownership of the company is now secure and the firm's backers are not looking for an exit yet.

"Oak Hill has a reputation for investing longer than most private equity firms," he said. "That does not mean if someone came along next year with a ridiculous amount of money they wouldn't sell, but that is unlikely. Their plan is to try to stay with us for a number of years and they are very much in the investing and growing stage. They are nowhere near looking to try to get out at this stage."

For this calendar year, Pulsant is expecting to hit revenues of about £45m, but Howling said he is targeting between £100m and £150m in five years through acquisitions and organic growth.