SI New Signature Buys Canadian Firms to Boost Azure Skills

New Signature has acquired two firms with a combined 50 employees to expand its presence into Toronto and boost its Microsoft Azure service offerings, the company said Monday.

The Washington, D.C.-based system integrator has put the $35 million of venture capital it received in late April to quick use, purchasing Microsoft professional services solution provider CMS Consulting as well as independent software vendor and managed services provider Infrastructure Guardian (IG).

"Microsoft really wants partners who can come up and deliver a cohesive and holistic message," Chris Hertz, New Signature co-founder and president, told CRN. "The goal of raising the money was to do exactly this."

[Related: Super Microsoft SI New Signature Gets $35M, Names New CEO]

The acquisition will further New Signature's push to provide midsize businesses with a complete Microsoft solution across on-premise, hybrid and cloud environments by deepening its expertise around Azure, Hertz said. The companies meet all of New Signature's acquisition criteria: practice depth around Azure, geographic expansion into Canada and recurring revenue from intellectual property.

Clients with as many as 10,000 employees often have to work with four or five companies to get expertise across the entire Microsoft stack; Hertz said New Signature is working hard to remedy the lack of a one-stop Microsoft shop for midsize clients.

Unlike other Microsoft shops that continue to focus excessively on their legacy business, Hertz said, CMS Consulting and IG have made forward-thinking investments.

Brian Bourne, who founded and led both CMS Consulting and IG, will become New Signature's president of Canadian operations, and all of their employees will remain with New Signature, which was the 2014 Microsoft Partner of the Year. The deal closed Friday, and the purchase price was not disclosed.

The acquisition expanded New Signature's head count from 95 to 145, thanks to the addition of sales, marketing and technical talent from CMS Consulting and IG, Hertz said. The Canadian companies actually outsourced all of their back-office functions such as accounting and finance, Hertz said, meaning there are few redundancies in personnel among the firms.

The workforce of both companies will be fully integrated into New Signature, and all of their solutions will be rebranded under the New Signature name. CMS Consulting's and IG's customers are predominantly enterprise or midsize companies based in the Toronto area and concentrated heavily in the financial services vertical.

Existing New Signature customers will be able to to take advantage of IG's Azure Governance Portal, which Hertz said provides customers with greater control over the subscriptions, usage and spending associated with their Azure accounts. Companies using IG's Governance Portal are expected to consume more than $1.24 million of Azure, according to Hertz.

"We're seeing Azure really take off over the last six months, and we think it's going to be a rocket ship for the next couple of years," Hertz said.

IG also provides data center, endpoint and cloud management through its around-the-clock oversight of the System Center solution, making it far easier for end users to operate Azure without needing to deploy and manage System Center themselves, according to New Signature. CMS is a Microsoft Gold solution provider specializing in next-generation infrastructure and offering clients an accelerated day of hands-on training for Azure.

Existing CMS Consulting or IG customers will benefit from New Signature's breadth of Microsoft offerings, spanning Office 365 and Dynamics CRM Online, Hertz said.

CMS Consulting and IG are expected to be the first of many acquisitions for New Signature as the solution provider uses the venture money from Columbia Capital to grow its head count to 180 to 270 employees by spring 2017. The solution provider is also looking to establish operations in Raleigh, N.C., and Atlanta and eventually expand its operations further west.

"We are aggressively growing," Hertz said.

PUBLISHED JUNE 1, 2015