Solution Provider Atrion Networking Merges With Sister Company To Ramp Up Services Push

Atrion Networking Corp., a $120 million solution provider in Warwick, R.I., has announced a merger with its sister company, Atrion Corp., Flemington, N.J., as the combined companies look to put a bigger emphasis on services.

Atrion Corp was founded by Walter Hazzard 30 years ago. Atrion Networking Corporation was founded 27 years ago by Charlie Nault and partner Tim Hebert. Atrion Networking is a Cisco Gold and Microsoft Gold partner that offers a bevy of integration, consulting and professional services. Atrion Corp.'s is an HP Elite and Oracle Gold partner with a portfolio of infrastructure, software, cloud and managed services. The two entities have operated as sister companies, but more recently have been deepening their relationship, first with a strategic alliance and now with a full merger.

The two solution providers now will be integrated under the Atrion name and led by Atrion Networking CEO Tim Hebert. The combined company will have a "tightened category of solutions and services offerings," Atrion Senior Director of Marketing Garry Foisy said.

[Related: Tech Data And Microsoft Ink Exclusive Mobile Accessories Distribution Deal]

The combined company will have around 300 employees, with a goal to hit $140 million in revenue by the end of the year, including the 18 employees and $15 million in annual revenue Atrion Corp. brings to the union. That growth goal will be achieved, Hebert said, by putting a laser focus on building the services business of the combined entity.

"That growth is the No. 1 focus," Hebert said.

Right now, Atrion Networking gets 35 percent of its revenue from services, Hebert said. By comparison, Atrion Corp. brings in about 15 percent of its revenue from services. The goal, Hebert said, is to derive 50 percent of the combined business' revenue from services.

The budding services business is a major growth opportunity for the combined companies to build more managed services and cloud-based offerings. The two companies have already tackled $2 million in combined contracts, with $1.5 million of that in pure services.

"There's this cross-pollination of expertise that’s going to take place that’s going to allow for a wonderful blend in the merger to take place," Foisy said.

Atrion also will hire around 80 new employees over the next year, two-thirds of which Foisy expects will be services and support technicians.

The change echoes the movement in the industry toward managed services, Foisy said.

"It's a real challenge out there ... Now more than ever, IT leaders are seeking organizations to help them ... [with the] technology infrastructure that they're trying to support. That's been a big push of ours over the past years, and we've really tried to shore up that service element," Foisy said.

While Atrion Networking brings a lot of services capabilities to its New Jersey merger partner, Hebert said Atrion Corp. adds a product and technical expertise in storage, data centers and servers to the portfolio, as well as geographical reach for new services opportunities.

Prior to the merger, Hebert said that while he sister companies worked closely together, the dual names and branding was "confusing" to customers and was holding them back.

"To get that growth, we had to get more identified organization," Hebert said.

The growth goal over the next five years is 30 percent year-over-year and, ultimately, triple in size to $350 million in annual revenue by driving services revenue to a 50-50 mix, Hebert said.

"We're moving in that direction, that’s for sure," Foisy said.

PUBLISHED JAN. 28, 2015