News today that Sage uber partner SWK Inc (aka Silversun Technologies) intends to acquire VICOR Business Systems) for an undisclosed amount. The move is subject to the usual due diligence (remember that not all Silversun announcements have survived due diligence).
VICOR states $1.2 million in annual sales. They’re also a Sage, Info and Dynacom partner and offer some custom enhancements for the governmental market.
Until I know more I’m marking this down as a diversification move for Silversun/SWK.
Jeffrey D. Roth, Chief Executive Officer of SWK, added, “The acquisition of VICOR will help to fulfill three key growth objectives for our Company: geographic expansion of SWK into the nation’s capital region; expansion of our proprietary product and service offerings; and the addition of highly specialized consultative expertise and experience in ensuring compliance with complex procurement rules and regulations for those clients conducting business with the Federal government. We look forward to quickly advancing our due diligence process so that we can conclude the transaction and welcome VICOR’s top notch people to SWK’s team of professionals.”
Subject to further due diligence and certain closing conditions, a definitive agreement is expected to be signed and the transaction completed on or before July 31, 2013. Detailed terms and conditions of the proposed transaction were not disclosed.
Both are very busy.
Mark Meller, Chairman and Chief Executive Officer of SilverSun, stated, “Simply put, there were too many hurdles to overcome in order to make our targeted closing date of January 1, 2013. Organization charts, tax issues, and rationalization of overhead expenses were just some of the myriad of issues that needed to be addressed. Rather than race to the finish line in chaotic fashion to try to make an artificial deadline, we have agreed with ISM to suspend our negotiations for now. We will revisit the transaction after the new year when we can address these issues in a more comfortable fashion.”
Jeffrey D. Roth, CEO of SWK, added, “The negotiation process has only heightened our admiration and respect for the entire team at ISM. It is clear that SWK and ISM share the same core values; we are confident that once we are merged together, we can fully optimize our combined strengths and become a dominant force in the market. We look forward to restarting the process in 2013.”
Whether this deal happens in 2013 is anyones guess though I’d be more confident that it would if the press release provided an extended deadline.
As you may know, Chicago IL Hightower Inc, once a top Sage partner, closed suddenly in March 2012. Their enhancements and customers were acquired and are now developed by Sage partner SWK Inc.
There’s something a little ironic about a portion of the notice just sent to the channel.
What does the Ghost see? Go review the fire sale price that leading Sage partner Hightower Inc (apparently $3 Million revenues in 2011) commanded.
$350k plus $65k for delinquent IRS taxes. That’s the end result of 24 years of toiling to build a business.
The only price someone was willing to pay for 850 customers and 700 custom enhancement customers was a little over $200 each.
If this is not a wake up call and you start making plans today (assuming you have not already) to move off the billable pay-as-you-go business model — you should get out of the business while you still can.
After 24 years in business, leading Chicago IL Sage partner Hightower Inc. suddenly closed their doors in late March 2012.
The remains of the company appear to have been actively shopped with the winning bidder being Livingston NJ based SWK / SilverSun Technologies.
Because SilverSun (corporate parent of SWK) is a public company we get to peek at the exact price a 24 year old one-time industry leading Sage partner such as Hightower Inc. fetches on the open market.
Based on the press release by SilverSun (the acquirer and corporate parent to Sage partner SWK) the 2011 Hightower revenues appear to have been about $ 3,000,000.
Other goodies disclosed in the purchase agreement?
How about an apparent IRS liability of $120, 011.92 (of which 1/2 seems to have been paid by SilverSun and 1/2 by Hightower Inc shareholders as part of the purchase agreement). Consulting agreement for shareholder Robert Nordin stipulating that he will consult for up to 8 hours a month at no cost (with his rate being $150 for excess hours). Shareholder Jeffrey Rosengarden snagged a $1,850 monthly consulting agreement terminating in June 2015. The third shareholder, Brian Dunn, is not mentioned as receiving any consulting contract.
Full details follow.
The obituary for Sage Partner Hightower Inc just appeared online in the form of a press release announcing the closing of a previously announced deal to purchase Hightower’s assets by New Jersey based SWK/SilverSun Technologies.
.. approximately 870 additional Sage ERP customers, an impressive suite of proprietary enhancement software solutions (with approximately 700 users)..
As with most ugly deaths suspected to be largely self-inflicted, the cause of death was not disclosed.
Selling price will be out shortly in an anticipated 8-K filing by SilverSun which is public and has to disclose these types of things.
Full press release after the break.
Lots of speculation over what has happened — and is happening — at ERP VAR Hightower Inc of Skokie IL.
It’s been almost a week since reports surfaced that employees were sent home with their belongings in a box and told to await further word. Everyone involved in the company – and what I presume are negotiations over what to do with customers and intellectual property – have been silent.
Unlike seasonal businesses such as landscapers and house painters – consulting is not usually one where you can lay off crews of employees for large gaps of time.
In the consulting world appearing to disband your business prior to having a deal for someone to take over servicing the customers doesn’t exactly put you in a power position for negotiating any potential sale or transfer.
I don’t expect the sounds of silence to continue much longer. Either Hightower is going to need to announce something or Sage likely will do it for them.
SWK handling HighTower client and reseller support effective today bit.ly/GPYOZi
— Brian W Dunn (@brianwdunn) March 23, 2012
UPDATE: March 23, 2012 9:00AM ET – Hightower’s Blog Site has been updated to indicate that “Effective today, Friday March 23, 2012, SWK will be handling all HighTower client support, as well as supporting resellers of HighTower enhancements“.