CMS Distribution acquires German VAD as it targets multinational rivals

A fifth of newly acquired sysob business is generated by services, CMS' chief business officer Huw Jones tells CPI

CMS Distribution says it will use newly acquired German arm sysob's services prowess as a key differentiator against multinational rivals already operating there.

CMS last week announced it had acquired the Bavaria-based security, networking and enterprise tech distributor sysob, after around a year of talks.

It represents the Anglo-Irish distributor's first B2B acquisition outside of the UK and Ireland.

Talking to Channel Partner Insight, CMS chief business officer Huw Jones said that sysob would be doing battle mainly with multinational distributors such as Tech Data, Ingram, Arrow, Exclusive and Infinigate.

"Around 20 per cent of the business is project, professional and managed services, so it builds a high degree of value for its vendors and customers," Jones said.

"The predominant competition is the globals, but its differentiator is that value proposition."

With vendor franchises including Okta, Pulse Secure and Yubico, sysob serves around 1,500 trading customers in Germany and around 4,000 in the wider DACH region, Jones said.

Although £500-revenue CMS has a thriving B2C business in mainland Europe (partly through its acquisition of Widget), the acquisition marks its first B2B foray outside of the UK and Ireland.

CMS' key B2B franchises in the UK and Ireland include Red Hat, Suse, Solarwinds, Barracuda Networks, Micro Focus and Commvault.

Jones said that CMS is ready to talk if its existing enterprise vendors see merit in extending their contracts into the DACH region.

"If they're interested in opening up supply lines outside of existing contracts, we'd be open to that - but there's no expectation at this stage," he clarified.

Jones indicated CMS had been in talks with sysob since the "front end" of 2020.

"We spent time working through the processes to ensure there was the right cultural fit. There was a team of people across CMS working through that, and we're confident we found a really good business to invest in," he explained.

The security and enterprise software market are both growing in Germany, with the wireless market experiencing growth "in excess of 20 per cent", Jones said.

"Sysob is set up to address security, wireless and server-based computing. It does that through a very strong project and managed services business, so we've got a growing market segment with a services business that really adds value for our vendors and customers," he said.