Essex Technology Group, Inc.

Client Profile

Based in New York, New York, Essex Technology Group, Inc. (“Essextec” or the “Company”) Essextec is a leading technology solutions provider that offers its customers cutting edge cloud, cognitive and cybersecurity solutions.  The Company, recognized as a Platinum Business Partner by IBM, works with its top tier client base by guiding them through digital transformations and building secure cognitive applications in hybrid cloud environments. Essextec, headquartered in New York City, is also a value-added reseller of hardware and software for cloud infrastructure as well as server, storage and network applications. Over its history, Essextec has invested in and expanded its capabilities and competencies by building out highly skilled IT consulting teams that are industry thought leaders and experts in technology and cybersecurity.

Situation

Since its founding, the Company successfully operated as a value-added reseller (“VAR”) of integrated technology solutions by continuing to develop and expand its knowledge base leading to growth and profitability.  In order to further diversify its core VAR foundation and leverage cost synergies related to operational efficiencies, the Company made two strategic acquisitions in the mid-2010s.  The acquisitions transitioned the Company from a VAR into a full service IT solutions provider by adding an IT consulting division.  However, the acquisitions burdened the Company with a debt structure that significantly constrained liquidity and profitability.  At the end of 2017, the Company embarked upon an organizational restructuring and reduction in its operating expenses.

Solution

SSG was retained by Essextec as its exclusive investment banker for the purposes of exploring strategic alternatives which included a sale or merger of its business.  SSG conducted a comprehensive marketing process, contacting investors and potential strategic acquirers in order generate the best outcome for the Company’s stakeholders.  Ultimately, a merger between Essextec and Converge was determined to be the best alternative for Essextec.