Sirius CEO: Private Equity Infusion Will ‘Accelerate Our Ability To Grow’

Sirius Computer Solutions Inc. announced that it’s won over a massive private equity partner -- Clayton, Dubilier, & Rice -- in a deal that will allow the solution provider to grow both its security and services practices, Sirius CEO Joe Mertens told CRN.

“Our focus over the years has been very much a combination of both organic, as well as acquisition related growth,” he said on Friday afternoon. “I don’t see that changing so we will continue to focus there. We have also made very specific investments around security and services. We will continue there as well. Having a larger private equity firm, providing us with that support going forward will certainly accelerate our ability to grow and build in those key areas.”

Clayton, Dubilier & Rice, a private investment firm, acquired a majority equity interest in Sirius, which has $3.5 billion in annual gross sales. Sirius – No. 24 on the 2018 CRN Solution Provider 500 -- provides technology solutions that help clients transform their business and manage their operations, Sirius said in a statement announcing the sale.

“We have fantastic team, who has helped us build and grow this business over the years,” Mertens said. “When you have a firm like CD&R providing you that backing it says that your strategy is certainly working, and frankly it is an endorsement of what we’ve built here over the last 38 years we’ve been in business.”

Sirius said its current majority owners, funds affiliated with Kelso & Co., will exit their investment at the close of the transaction.

Mertens said Sirius has a wide skill set and the ability to work across many verticals, but it has gravitated towards health care and security.

“We certainly from a business perspective have broad-based capability: mainframe, down through Intel storage and networking, but we’ve made some significant investments around healthcare from a vertical perspective, a lot of focus around supporting hospital systems,” he said. “And then security and managed security has been a big area of investment for us. We recently opened up another Security Operations Center, this one in Omaha, Nebraska.”

All together, Sirius runs two SOCs and five Network Operations Centers, Mertens said, which deliver end-to-end solutions for strategy development; technology selection, implementation and operation; and run multiple delivery models such as on-premise, off-premise and cloud.

Mertens will continue to lead Sirius as president and CEO, and there are not expected to be any changes in the company’s current management structure, Sirius said in a statement.

The transaction is expected to close late in the second quarter of 2019, and is subject to regulatory approvals and other customary closing conditions.

Kirkland & Ellis LLP is acting as legal advisor, and Credit Suisse is acting as financial advisor to CD&R in the transaction. Debevoise & Plimpton LLP is acting as legal advisor, and Raymond James & Associates, and William Blair are acting as financial advisors to Sirius.