SMS Management and Technology has acquired its second MSP this year as it searches for new growth opportunities.
The $278 million-turnover public company acquired solutions provider Birchman Asia Pacific for $25 million. SMS will make an upfront payment of $12.5 million – funded by debt – and an additional two payments conditioned on profit performance over the next two years.
SMS marketing manager Marlon Perera said Birchman Asia Pacific complemented SMS's business while increasing its competitiveness in other areas.
"Like SMS they have a consulting, a systems integration business and also a managed services offering."
SMS entered the managed services business when it acquired Indicium in July for $22 million, giving it the capabilities to offer business cloud and infrastructure management solutions.
"We're trying to diversify more into managed services with the market being what it is," Perera told CRN.
"We acquired Birchman for its strengths as a managed services provider and to beef our presence in Western Australia."
More than 30 percent of Birchman Asia Pacific's revenue comes from application support, managed services and other multi-year agreements. The company has forecast annualised revenues of $32 million from Western Australia.
Birchman Asia Pacific is based in Perth, but the company's 200 staff work in offices around Australia. Perera said all staff will be retained and that SMS will be moving into Birchman Asia Pacific's offices.