Signature Technology Group Acquires Partner GlassHouse Technologies' Ailing U.S. Consulting Division

Phoenix-based Signature Technology Group (STG) has acquired longtime partner GlassHouse Technologies' U.S. Consulting Division for an undisclosed amount in a move the company said will allow it to deepen its data center expertise.

CRN 2013 Fast Growth 150 company STG is a services-only company that partners with VARs, OEMs, DMRs and more to offer data center services such as white-labelled delivery services. The acquisition of the GlassHouse division brings more high-end consulting capabilities to the company's portfolio, STG CEO Charles Layne said in an interview with CRN.

"With this higher-end technical team, we have the capability to move up the stack," Layne said.

[Related: Channel Consolidation: Channel Chiefs Talk Partner Mergers and Acquisitions ]

The move will bring on all of the GlassHouse division's consultants, contractors tied to the agreements, sales teams and residency experts, Layne said. STG will commit to developing continuity to customers in the acquisition and build on current customer relationships, he said.

"Investments will flow around this team; when we look at growing opportunities around there, the reality is we will continue to invest in the team and expand the overall footprint ... We think with the right investments, the right customer base [and] the right people we can really turn this on," Layne said.

To that end, STG is currently in the middle of an "aggressive plan" to integrate backhouse IT processes with the former partner. With the move, the company also bought the rights to GlassHouse's internal data center migration tool Reflector, which will help improve data center migration processes for the company. Layne said STG plans to license the tool out in the future as well.

"A longtime partner of GlassHouse, STG is well known for its focus on leading-edge data center and cloud technologies and its legendary customer service. We share the same technology focus and values, and we are thrilled to be joining forces with STG," Steve Sharp, CEO of GlassHouse Technologies, said in a prepared statement.

Southborough, Mass.-based GlassHouse Technologies has hit hard times over the past few years, posting multimillion-dollar sales losses for the past three years. Most recently, HM Revenues and Customs, the UK's counterpart to the U.S. Customs and Border Protection Agency, slapped the company with a petition for an undisclosed amount of unpaid debts.

"It's really a shame what happened to GlassHouse, but it’s a great opportunity for us," Layne said.

Layne said that every partner he has spoken to about the news has responded very positively. The companies had some mutual partners and he said that STG will work to maintain continuity for both those customers and the new ones brought on with the deal.

Layne said that he expects the acquisition will help improve customer stickiness and average order size by offering a more comprehensive solution that drives further up the stack. He said he hopes to deepen customer relationships with existing customers over drastically extending the customer base.

"Our goal is to be the primary data center solution provider," Layne said.

"We want to be a single data center services shop for these partners, and we think by deepening the capabilities with this type of expertise, the partners can rely on us more from a technical perspective as well as planning perspective, where before we didn’t have that. We were great at deployment, we're great at delivery, but this rounds us out," he added.

This is the company's third acquisition since November, and Layne said he expects more acquisitions that make sense for the company to be in the works in the coming months.

PUBLISHED APRIL 16, 2014