Channel M&A, Texas-Style: Lumenate Buys Troubadour

The new company will be called Lumenate, and it will be based in Dallas. Terms of the deal weren't provided, but according to Lumenate, the bulk-up positions it to exceed $100 million in revenue next year.

Jay Kirby, executive vice president of Troubadour, said the solution provider has about 85 employees post-merger, and that almost all of each company's existing employee base was retained.

"It was just too right not to do," Kirby, who will become vice president, network sales at Lumenate, told CRN at Cisco Partner Summit in San Diego this week. "The market is looking for integrators that can provide a wider solution set without losing deep dive experience. We have a strong presence in Houston, and they do in Dallas."

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The push toward converged infrastructure is driving a lot of partners to seek stronger networking, storage and data center practices, so Troubadour's focus on networking, infrastructure and security and Lumenate's on storage and data center made the two companies complementary, Kirby said.

"The cherry on top was that we were network and they were data center," Kirby explained. "The executive teams were a lot alike and the cultural fit was spot-on. Basically, a match made in heaven."

Lumenate has acquired several fellow solution provider partners in recent years, including a division of Stonebridge Technologies focused on IT advisory services in 2006 and a security specialist, ANI Direct, in January 2012.

Consolidation has been rampant in the channel as of late, including several big deals that have had a direct bearing on the Cisco ecosystem. Presidio in the past six months has acquired both INX and BlueWater Communications, for example, and ePlus acquired major West Coast Cisco solution provider Pacific Blue Micro in February and Bedford, N.H.-based VantiCore in January.

Solution provider M&A has been a frequently buzzed-about topic at this week's Cisco Partner Summit. Edison Peres, Cisco senior vice president, worldwide channels, told partners that Cisco, going forward, will incorporate more feedback from investors and channel M&A stakeholders into how it designs partner programs -- the idea being that Cisco can tailor its partner programs toward elements that give solution providers better valuations.