The Channel logo

News

By | Timothy Prickett Morgan 3rd January 2011 22:16

Sirius to top $1bn in sales with MSI Systems acquisition

Big in the midrange

The rate at which private equity firms are gathering cheap money to make acquisitions combined with an IT industry consolidating on many fronts can make you dizzy. That's why it's not much of a surprise that Sirius Computer Solutions has acquired MSI Systems Integrators for an undisclosed sum. Both are among the largest players in the IBM Power Systems market, and have histories that stretch back to the AS/400 days.

Sirius is over 30 years old and is based in San Antonio, Texas. The company currently has 665 employees with a combined 3,800 different technical certifications. The privately held company has financial backing from private equity firm Thoma Bravo, which kicked an undisclosed amount of cash to Sirius back in November 2006 to get an equity stake.

Thoma Bravo is the private equity firm that bought high-availability software makers Vision Solutions, iTera, and Lakeview Technology, and glued them together in 2006 and 2007. In May of last year it acquired Windows high-availability clustering-software vendor Double-Take for $242m. Thoma Bravo was also one of the investors in the Attachmate conglomerate, which added together host-access and application-transformation vendors Attachmate and WRQ, and systems-management and security-tool vendors NetIQ and PentaSafe. By the way, Thoma Bravo has a hand in the $2.2bn acquisition of Novell by Attachmate, which was announced in November 2010.

Thoma Bravo is showing legacy software businesses more attention than either IBM or Novell have done in a decade. If you have ever wondered what you would do if you could buy the IBM midrange business, think about this: Orlando Bravo and Scott Crabill, the managing partners at the private equity firm who have been behind all of these investments, do not have to wonder. They seem to be doing it, bit by bit, and they know.

MSI Systems Integrators, based in Omaha, Nebraska, was founded in 1994 and has grown to over 400 employees, generating more than $350 million a year in sales. The company operates in 17 states in the central and western part of the United States, and 180 of its people are IT consultants, engineers, specialists, and project managers that do what the company's name suggests: integrate systems.

In particular, we're talking about IBM's System z, Power Systems, System x, and BladeCenter systems as well as HP's ProLiant and BladeSystem machines. The company's techies have over 700 certifications on various technologies, and also help design data centers or help customers select co-location services for their iron.

MSI also operates what it calls Technology Enablement Centers in its home base of Omaha as well as in Des Moines, Kansas City, Minneapolis, Peoria, Portland, Salt Lake City, and St Louis. These centers are where MSI has been showing off new technologies to customers as part of its sales pitch; they are also a key aspect of why Sirius was interested in buying MSI.

With the acquisition of MSI by Sirius, all of those techies and skills can be replicated on the US national scale at which Sirius operates. Sirius is an IBM and HP partner, just like the company it is acquiring, and is also a partner of NetApp for storage and Cisco Systems for networking and its "California" Unified Computing System blade and rack servers, and their converged 10 Gigabit Ethernet system-storage networks.

Sirius says that now that it has acquired MSI, it has close to 1,100 employees who have over 4,500 technical certifications. The combined firms will have more than 400 sales reps and more than 450 product specialists and technical consultants. Sirius will have close to 40 office locations, and hundreds of employees who provide wider coverage from home offices. (There is no shame in saying this in 2011; in fact, it's an asset and a cost cutter.)

The financial terms of the acquisition of MSI by Sirius were not disclosed. Jim Simpson, who is president and CEO at MSI, will be staying on at Sirius helping to grow their Cisco-related business. So don't think that this deal is just about cornering the market on the IBM Power platform. The world is more complicated than that.

Sirius was founded in 1980 by Harvey Najim. At that time the company was known as Star Data Systems. Prior to that, Najim spent 13 years at IBM in various technical, marketing, and management jobs. ®

alert Send corrections

Opinion

Lightning

Jack Clark

Just as Jeff Bezos did to books and CDs, Amazon's rivals are now doing to it
Microsoft CEO Satya Nadella
ARA_LIbertad

Chris Mellor

Elliott Management sinks its teeth into retiring godhead

Features

Failure to crack next-gen semiconductors threatens to set back humanity
SMEs get lip service - what they need is dinner at the Club
SAP Match Insights
Vorsprung durch grossendatatechnik, as we like to say in Germany
Inside the Google Lab where surgeons prepare the human/dog experiment
Big Blue exec tells El Reg what to keep an eye on