PFH Computers has merged with CK Business Electronics, creating one of the largest privately held technology providers in the country. The combined entity will trade as PFH Technology Group, with revenues of more than €36m and employing over 140 staff.
The value of the deal has not been disclosed but money did change hands. CK founder Gerry Gray exited the company following the merger. “It was a good deal for Gerry and a good deal for ourselves,” said Paul Hourican, managing director of PFH.
Both firms are well established in the Irish ICT market with a strong emphasis on Munster and Connacht. PFH is headquartered in Cork and CK was led out of Galway, although both companies also have offices in Dublin.
According to Hourican, the merger process began 18 months ago when PFH realised that further long-term growth would not be possible as a single player. “With the market forces in play — the convergence of data and voice technologies and the commoditisation of products and services — we needed to get scale,” Hourican told siliconrepublic.com.
CK had been undergoing a similar process and the deal resulted from conversations between Gray and Hourican, who knew each other for many years. “We felt it was an obvious fit,” said Hourican, who will head the new group. Other directors include Paul Callaghan, John Hickey and Martin Kirrane. Callaghan will also act as general manager of the group’s Dublin and Galway offices.
Both companies are similar in size, employing around 70 people, both profitable and each with a turnover of close to €18m. “There are synergies: we both do a lot of the same things but we do have a lot of complementary skills and services,” said Hourican. PFH now intends to sell its managed IT service to CK customers while CK’s background in server virtualisation is suitable for PFH’s client base, he added.
The new group said that much of its planned growth will be in services, which is more profitable than product sales but does not tend to swell turnover figures to the same extent.
The deal comes as other IT providers such as Calyx have pursued an aggressive acquisition strategy to grow market share in Ireland. Hourican confirmed that PFH would consider a purchase if the opportunity arose. “If there are complementary companies out there we’d be looking at them,” he said.
By Gordon Smith