Growing Mid-South Based Full-Service IT Managed Solutions Firm!

Listing Number: 75951-327715

Description

This business is a Mid-South based information technology services firm that has served as a leading provider of IT managed services and high-technology solutions since the mid 1980s. Initially this firm provided turnkey systems for Medical & Dental offices throughout the USA. After receiving many national endorsements, it then decided to venture into the corporate and government (GSA) arenas. It currently is a leading national provider of turnkey information technology and communication solutions for businesses, institutions, and government agencies across the USA. Its service lines include managed services, hardware, networks, consulting, and more. This business also offers innovative and cost-effective solutions such as project management, application software solutions, remote backups, helpdesk, and disaster recovery services. This business propagates outstanding customer services with 24/7 maintenance and remote monitoring support, and also serves as a one-stop shop for clients seeking flexible, customer-centric solutions based on the clients' time and budget constraints, as well as their integration and scalability scopes.

Business History -
This business started up in 1986 as a small computer services entity. Since then, the growth in revenue that it has propagated signifies a continued promising future for it. IT consulting services, which provides far greater margins and recurring revenue, generate a large portion of this firm's revenue, a factor which illustrates that this business has evolved into a value-adding IT consultancy verses a traditional IT services
reseller.

Financials -
This low-debt business continues to demonstrate strong revenue growth and capture increasing market share within its growing industry sectors. Currently it is experiencing steady year-over-year growth rates in recurring revenue under contract per Managed Services, providing recurring revenue that serves as a base with which to budget company expenses and expansion on a monthly basis. Its balance sheet has room for leverage to promote new service projects and staffing since its current level of long-term liabilities is low. There is no customer concentration risk here and revenue has been increasing every year. The company has more than 1300 clients, most of which are on 5 year contracts! These diverse contracts are spread across public, private, and governmental entities, and include some of the largest employers in the Mid-South region of the USA.

Recent Financials consist of four years of increasing Revenue, EBITDA & SDE:
2014 Revenue -> $8,898,715
2014 EBITDA -> $818,523
2014 SDE -> $1,219,123
--
2015 Revenue -> $12,172,969
2015 EBITDA -> $1,115,270
2015 SDE -> $1,479,870
--
2016 Revenue -> $13,884,945
2016 EBITDA -> $1,277,456
2016 SDE -> $1,672,128
--
2017 Revenue -> $13,309,564
2017 EBITDA -> $1,316,521
2017 SDE -> $1,711,193
--
2018 Projected Revenue -> Between $13.5M and $16.5M
2018 Projected EBITDA -> Between $1.3M and $1.7M
2018 Projected SDE -> Between $1.7M and $2.1M

Competitive Overview -
This business's largest operational expense is employee salaries and wages, making its P&L relatively easy to manage and change based on competitive factors. To maintain its competitive edge, it provides the highest quality products and services while maintaining moderate pricing for the clients. By focusing on professional services during the lifespan of the partnership, it maintains win-win relationships with its customers and vendors nationwide. In addition, it has positioned itself to remain competitive and financially solvent through creative marketing and innovative partnering.

Current Services Provided -
Professional Services:
- IT Staffing
- Website Design
- Server/Desktop Virtualization
- Workstation/Desktop/Server Configurations
- Systems Design/Implementation
- Print Management (Xerox Pagepack)
- Office Automation –> Medical/EMR, Dental & Small Business
--
Network Services:
- Network System Design
- Voice/Data Cabling
- Wan/Lan/VPN Design
- Wireless Network Design
- Onsite Network Support
- Voice/IP Phones
--
Break/Fix Services:
- PC Brands -> Dell, HP, IBM, Lenovo, etc.
- Printers -> HP, IBM, Epson, Lexmark, Dell, Xerox, etc.
- Onsite-Service Contracts

Growth & Expansion Considerations -
This business continues to demonstrate strong revenue growth and capture increasing market share within its growing industry sectors. Currently it is experiencing steady year-over-year growth rates in recurring revenue under contract per Managed Services, providing recurring revenue that serves as a base with which to budget company expenses and expansion on a monthly basis. Its balance sheet has room for leverage to promote new service projects and staffing since its current level of long-term liabilities is low. A strategic purchase would give the buyer approximately 1400 clients, most on five-year contracts, to sell other products and services to; expand the geographical location and market penetration by utilizing the headquarters as a hub for expansion into other geographical areas; aggressively acquire modern technologies and/or companies with modern technologies to expand into vertical markets and offer more services to current customers; and to license processes and expand overall market share. As a result, this firm represents a tremendous opportunity for a larger Software, IT Consulting, or a Data/Voice firm looking to expand and diversify via a highly strategic acquisition.

Miscellaneous -
Owner is currently asking $17.5M for the business, which includes furniture, fixtures, office equipment and demo/spare parts. Seller will consider all reasonable offers as well as limited employment. Seller will agree to work with new owners for 3 months (90 days) to help them meet their contract clients, understand their customer standards and transition employees. For any additional time beyond the 90 days, the Seller will negotiate his salary.

NOTICE:
* Revised asking price of $14M is for 100% control of the firm.
* This is a proposed Equity Sale. It is anticipated that Buyer will obtain complete control of all assets of the firm, including, but not limited to contracts, customers lists, vendor lists, equipment, inventory and goodwill.
* All liabilities will be paid off at closing settlement. A complete list can be provided with an executed Letter of Intent (LOI).
* All information, data, financials, valuations, appraisals, real estate values/leases, etc. must be verified by both the seller's and buyer’s own CPAs, attorneys, & other independent professional advisors.
* Potential buyers should always verify all information with the seller and their own independent professional advisors before putting any money at risk.
* Interested parties must show proof of cash available and/or proof of highly committed equity partners upfront. Will need to provide details about the firm you work with, your source of funds, and how you plan to finance this acquisition. Proof can be provided in the form of a bank statement, a letter of guarantee from your bank, and/or a commitment letter from your equity partners.
* Non-Disclosure Agreement (NDA) is required as the seller’s corporate and financial data is confidential and will only be disclosed to qualified buyers with a signed NDA in place. Please contact us for the required NDA form to sign.

Listing Details

  • Price: $14,000,000
  • Down Payment: $0
  • Sellers Discretionary Earnings: $2,100,000
  • Total Sales: $16,500,000
  • Location: Tennessee

  • Inventory: $398,767
  • FF&E: $594,028
  • Employees: 5
  • Year Established: 1986
  • Reason for Selling: Owner intends to retire and is looking for strategic purchaser to continue to grow the business.
  • Category: IT Services

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