Oracle Services Giant Rolta Acquires SP500 Power AdvizeX

India IT services giant Rolta, one of the top Oracle services partners in the world, is acquiring SP500 infrastructure power AdvizeX Technologies LLC in an ambitious bid to "redefine the IT channel" for the future.

Rolta International Inc., an Alpharetta, Ga.-based subsidiary of Mumbai, India-based Rolta India Ltd., is paying $32 million for AT Solutions Group, LLC, the parent company of AdvizeX Technologies LLC.

Ultimately, the deal creates a nearly $500 million international power with nearly 4,000 employees, combining multinational system integration giant Rolta India Ltd. with $336 million in annual sales and 3,700 employees with widely respected CRN Tech Elite 250 power AdvizeX, which was No. 113 on the SP500 list last year with $147 million in annual sales and about 200 employees.

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"We are going to be the first company to put a major effort behind combining a leading system integrator and VAR to attack this software-defined data center opportunity," said AdvizeX President Fred Traversi in an interview with CRN. "I told our AdvizeX employees that our customers and OEM partners are going to require a redefinition of the IT channel as it stands today."

The deal paves the way for Rolta-AdvizeX to provide a new level of "technical innovation" as it moves to grab more share in the software-defined data center market, said Traversi. "These new applications are redefining where companies compete," he said. "A traditional VAR and SI couldn't do it by themselves."

The deal puts Rolta-AdvizeX squarely into the big data, business intelligence markets being dominated by high-priced services giants like IBM, Accenture and Computer Sciences Corp.

With social media driving a whole new set of applications focused on big data and business intelligence for enterprise businesses, Rolta and AdvizeX are aiming to bring a new generation of unstructured data solutions and services to enterprise customers looking to provide real-time customer decision solutions in markets like retail and financial services.

"To us this is just the next phase of the growth for AdvizeX," said Traversi, who has headed the 37-year-old company for the last nine years. "Everyone at AdvizeX is very excited. This is about accelerating growth. This is about broadening our value proposition to our customers and extending our reach to more customers."

Rolta International President of International Operations Ben Eazzetta told CRN the deal was driven by a major market move toward engineered systems: complete hardware/software systems, such as Oracle's Exadata Database Machine and Oracle Exalogic Elastic Cloud servers.

Eazzetta confirmed the $32 million acquisition price but said that figure is a maximum that does not include cash and working capital inside AdvizeX; it does, however, include full escrow and "earn out."

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The engineered systems trend is increasing the demand for the kind of infrastructure services that AdvizeX offers, but which Rolta largely was lacking. Those include server assessment and consolidation, backup and recovery, disaster recovery, replication, and virtualization, among others. "We really wanted to be on the cutting edge of that," Rolta's Eazzetta said.

Rolta did an "exhaustive study" of as many as 100 solution providers to find one with the kinds of capabilities it needed, Eazzetta said. He specifically pointed to AdvizeX's technical capabilities and infrastructure assessment services -- including its "world-class" solutions center for developing proof-of-concept systems for customers.

In the past when Rolta was working on a customer IT project with an infrastructure component, Rolta would have to pass that work along to a subcontractor. "Now we can do that ourselves," Eazzetta said. He also sees big opportunities to leverage AdvizeX's expertise as more Rolta customers move their enterprise applications to cloud computing.

The AdvizeX acquisition even complements Rolta geographically, according to Eazzetta, with the combined companies covering much of the U.S. east of a line between Chicago and Atlanta.

The two companies began exploring a possible combination by working together on major deals in September, said AdvizeX's Traversi. The companies also brought key OEM partners into the discussions, said Traversi, including VMware, HP, EMC and Oracle.

The two companies already have solutions/services proposals to 17 customers with "extremely favorable" responses from those clients, said Traversi. "In some cases, Rolta brought AdvizeX into deals to provide infrastructure and in other cases AdvizeX brought Rolta for services capabilities," he said.

AdvizeX will retain its name and eventually add the Rolta tagline, said Traversi, who will remain at the helm of the AdvizeX unit.

As to the impact the deal will ultimately have on the SP500 market, Traversi said customers will be the judge of that as the company quickly moves to bring next-generation software-defined data center solutions and services to market.

What is clear, Traversi said, is that VARs and System Integrators that are "rich in technology and technologists will dominate over the next five years. Those VARs selling a supermarket of IT product without technical or services depth will have trouble moving forward over the next five years."

Martin Wolf, founder and president of MartinWolf, a technology services M&A financial services advisor, advised Rolta on the deal. "This is a very good deal for both parties," said Wolf, describing AdvizeX's Traversi as one of the "rock stars" of the channel who is determined to set a new course. "The shareholders are rewarded, employees are rewarded and customers are rewarded with more services. Customers will be able to get more from the combined companies than they would have been able to get from the companies independently. This is all about a focus on solutions rather than products."

PUBLISHED NOV. 6, 2012