INX Inc. snapped up Cisco VAR NetTeks Technology Consultants this week, continuing a trend in VAR consolidation.
The acquisition went for an initial $1.35 million in cash and 30,770 shares, with a potential payout of $2.8 million if NetTeks hits performance targets. NetTeks saw revenue of approximately $12.7 million for the 12 months ending September 30, 2008.
INX is a Cisco gold partner with special certifications in unified communications (UC) and security. NetTeks, which has 32 employees, is a Cisco silver partner that was an early UC entrant, but is also a certified managed services provider.
Houston-based INX said acquiring NetTeks, which has offices in Boston and Glastonbury, Conn., will give it further entry into New England.
“This acquisition, coupled with our existing Boston operations, will create one of our largest regions. For the past eleven years NetTeks has developed close and longstanding relationships with many customers in the region and has built a reputation for excellence in project management and network engineering,” Mark Hilz, president and COO of INX, said in a statement. NetTeks has about 200 managed service customers.
INX gives NetTeks the kind of capital necessary to grow in customers and into new technologies, said former NetTeks president and CEO Ethan Simmons, who will now be vice president of New England sales for INX.
“INX’s national presence, as well as the expanded set of solutions focused around the data center, will provide our team with compelling additional capabilities for our customer set,” Simmons said.
This is the second major acquisition for INX in a little more than a year. Last year, INX acquired Cisco gold partner Select for $8.5 million. INX is among a handful of larger VARs moving in on smaller ones to gain regional ground and customer count.
A number of analysts have said that rough economic conditions would cause further VAR consolidation. This deal doesn’t appear to be the result of economic troubles since NetTeks was not in an apparent financial bind.