It’s Official: IT Services Giant Ensono Acquired By KKR

‘[Investment firms] are seeing companies moving to the cloud, and seeing companies like ours helping those companies succeed not only with the new shiny stuff but with the legacy technology,’ said Ensono CEO Jeff VonDeylen.

Global IT services provider Ensono on Wednesday said global investment firm KKR & Co. has signed a definitive agreement to acquire the company.

Terms of the deal, which is slated to close within the next 60 days, were not disclosed. However, Reuters Tuesday reported that the deal could be valued at $1.7 billion, citing unnamed sources familiar with the matter.

Ensono is currently owned by Charlesbank Capital Partners and M/C Partners, who in 2015 acquired the company from Acxiom Corp. According to Reuters, the value of that deal was $190 million.

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Ensono, based in Downers Grove, Ill., provides IT services to help clients with IT infrastructure and digital transformation projects. The company designs, builds, and optimizes services for clients across mainframe, midrange system, private cloud, and public cloud infrastructures. Travelodge, Guinness World Records, and Windstream are among the solution provider’s clients.

Ensono is ranked No. 94 on CRN’s 2020 Solution Provider 500. The company had 2020 revenue of $650 million.

The decision by New York-based KKR to acquire Ensono comes during a time of significant change in the IT industry and in IT services providers, said Ensono CEO Jeff VonDeylen (pictured).

“The good thing for services providers like us is that IT is now front and center for customers’ business,” VonDeylen told CRN. “IT used to be a back-office thing. But we let clients focus on their business while we focus on the things to help them do so.”

For KKR and other investment firms, technology and technology services are a core tenant of their investments, VonDeylen said.

“They are seeing companies moving to the cloud, and seeing companies like ours helping those companies succeed not only with the new shiny stuff but with the legacy technology,” he said.

The investment by KKR in Ensono includes three parts, VonDeylen said. A significant part will be to bring the entire ownership of the company to KKR from Charlesbank Capital Partners and M/C Partners, he said. It will also include a recapitalization of Ensono’s balance sheet, as well as additional capital to help Ensono with future growth, he said.

For the rest of 2021, Ensono will be focusing on three primary initiatives, VonDeylen said.

The first is adding consultative capabilities similar to what it did earlier this year with Ensono’s acquisition of Amido, a London-based cloud-native software engineering firm. “We want to be a great service provider to help solve customers’ problems,” he said. “Cloud-native development with Amido helps us fill their needs.”

The second is a focus on security, VonDeylen said. “We want to bolster our capabilities and get engaged with customers,” he said. “Security is a big opportunity, and one of our customers’ top two or three concerns. This includes compliance and auditing as well.”

The third is development of Ensono’s Envision IT infrastructure management platform, VonDeylen said. “Envision is a critical part of our ability to bring services to clients, and to make it easy for customers to interact with us,” he said.

Those investments will likely include more acquisitions to go with the four the company has made since its founding in 2015, VonDeylen said.

Ensono’s first acquisition, U.K.-based Attenda in 2016, and its 2017 acquisition of Inframon, helped Ensono expand from a U.S.-centric company to one with a global presence, VonDeylen said. More importantly, Inframon brought Ensono a Microsoft Azure practice, which has now become a key part of its business. Indeed, he said, Ensono’s U.S.-based Azure practice is now much larger than its U.K. practice.

Ensono in 2018 acquired Wipro’s data center services business in a $405-million deal that included Wipro’s mainframe-focused managed services.

“Companies like Ensono gain scale and size over time as they are successful,” he said. “But there are opportunities that require new services or capabilities which a company can either build or buy. With Amido and Inframon, we made the decision to buy. And we see large outsourcing companies or companies like Accenture are making acquisitions to enhance skills and capabilities. They find it more effective to buy capabilities rather than build them.”

KKR has a long history in investing in IT companies across a wide spectrum.

The investment firm has investments in BMC, China-based ByteDance, service management platform developer Cherwell Software, software developer Corel, cloud-based data integration platform-as-a-service provider Jitterbit, cybersecurity awareness training provider KnowBe4, codeless software development platform provider Outsystems, managed communications provider RigNet, software portfolio management specialist SoftwareONE, and telecom infrastructure services provider Telxius.

KKR also previously invested in cloud storage provider GoDaddy, ERP software developer Epicor Software, and customer experience intelligence company Calabrio.