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By | Paul Kunert 2nd May 2014 12:14

Bytes Tech Group in 'early' talks with acquisition target

Future is services, services, services... oh and software (services)

Bytes Technology Group (BTG) is courting management at a software services target as the ink still dries on yesterday's contract to offload its Xerox concessionaire.

The Surrey-based business that has South African owners, sold the Bytes Document Solutions to fellow Xerox player Xeretec for an undisclosed sum as it was not deemed core to future strategy.

Talking to El Chan, Neil Murphy, UK boss at BTG, said there were a few names on his shopping list of relatively small bolt-on buys, similar to the size of Security Partnerships it acquired in 2011.

"We want to focus more on SaaS, management service and the cloud, that is where we want to put future investments," he said.

Businesses with a turnover of £10m to £15m making a ten per cent operating margin "would be ideal", the channel vet added.

"We'll buy this year, we are having the first conversations, it is very early doors," Murphy added.

Bytes is one of Microsoft's top table enterprise partners and the execs in Redmond are steering their channel types toward the cloud, and other types of services to justify their link in the chain.

There is less and less money to be made from straight licensing transactions, particularly in the largest accounts and all partners are reacting accordingly, some at a faster pace than others.

That said, Murphy said its business in the last year - results are due to be filed at Companies House soon - grew, "customers still have to be licensed, whether that is on premise or in the cloud".

"The opportunity is still vast for customers buying software and software services," he claimed. ®

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