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IT services specialist Adept has splashed out £5m for fellow channel player Shift F7, with the total cost of the deal potentially heading closer to £8m.Content Continues Below
The tie-up will give Adept a larger customer base, that has been built up by Shift F7 over the last 23 years, and more depth in its IT services offering without compromising its geographical focus on London and the South East.
The deal starts with a payment of £5m with a further £2.9m being payable depending on the performance of the Shift F7 business in the first year after the deal closes.
For the year ended May, Shift F7 delivered revenues of £5m. The deal covers not just Shift but also its commercial services operation Greencorn. That contribution will be added to the £46.4m generated by Adept in the 12 months that ended in March.
"We are delighted to have acquired such a high quality, well-run and profitable business with a strong management team," Adept CEO Ian Fiskwick said. "Shift F7 is an excellent fit because it enhances our market position in IT, particularly in London."
"After the Shift F7 acquisition, more than 70% of Adept revenue will be generated from managed services including IT support, unified communications and data networks," added Fishwick.
Adept is no stranger to using acquisition as a means of expanding its footprint and made a move to bolster its presence in London and the South East with a £8.6m deal to pick up OurIT in February 2017.
This latest deal adds to a growing list of acquisitions involving resellers over the course of this summer. There has already been Shearwater buying Brookcourt, Cancom picking up OCSL and HP snapping up managed print player Apogee. There are still a couple of weeks yet which could see that list lengthen.