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October 1, 2018
martinwolf  Transaction Analysis
Computacenter Acquires FusionStorm

Financial Information*
  • Enterprise Value                                        $135M
  • EV/LTM Revenue                                      N/A
  • EV/LTM EBITDA                                        N/A
Transaction Facts
  • European solution provider giant Computacenter plc (LON:CCC) announced today it has acquired San Francisco-based IT solution provider FusionStorm for a total of up to $135M.
  • An initial cash consideration of $70M was paid upon completion of the acquisition. Up to $20M of additional deferred cash consideration may become payable depending on the levels of adjusted EBITDA and gross profits achieved by FusionStorm over the 15-month period following completion. Computacenter will contribute a further $45M into FusionStorm to refinance existing facilities.
  • In the year ended 31 December 2017, Fusionstorm had revenue of $595.5M and pro-forma adjusted EBITDA of $12.1M.
  • As of 30 June 2018, the company had $225M in gross assets.
martin wolf  Analysis
  • Growth Areas : This is one of the largest supply chain acquisitions of a US company from a European company. Others have made small investments before, and in the US, CDW's acquisition of London-based Kelway in 2015 exemplified geographic expansion in the European market. Prior to Office Depot's purchase of CompuCom, Computacenter had a partnership with CompuCom in the US on certain global accounts for services. Now, as a result of this acquisition, the company will be able to leverage all its European global accounts for product fulfillment and services in the country.       
  • Promising RecordComputacenter has had a strong trajectory of growth in the past year, recording best-ever revenue for 2017; year-on-year revenue jumped 16.9 percent to ~$5.0B as strong performances from its German and French businesses helped push the number higher. On the heels of a record-breaking year, Computacenter has been able to expand geographically via targeted acquisitions. The solution provider acquired Misco's last-remaining European subsidiary in the Netherlands in early September, marking its first direct presence in the Netherlands and a significant boost for its Benelux business.
  • Services Leader: Computacenter's service revenues exceeded $1B, making the company the largest of all its direct competitors.
  • New Territory : FusionStorm's large-scale logistics capabilities, multi-site technology rollouts and key US accounts should help the UK-based solution provider expand geographically in a competitive geography and service the existing customers with their full range of service capabilities.
  • Changing Landscape : CDW, Insight, World Wide Technology, SHI -- and now Computacenter -- will have a meaningful cross-border portfolio, with Computacenter having the largest services portfolio. It will be interesting to see how the next tier of services or products companies will respond.
For more information about this transaction,  click here to read the press release.
*Financial information from the article.

martinwolf  was the advisor in this transaction.

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Headquartered in Scottsdale, Arizona with an office in New York, martinwolf is a leading M&A Advisory focused on middle market companies in the IT Services, IT Supply Chain, IT-Enabled Business Process Outsourcing and Software as a Service (SaaS) space. Since 1997, our team has completed more than 160 transactions in over 20 countries and sold eight divisions of Fortune 500 companies. 

 

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