IT Authorities, a Tampa-based information technology provider, has been acquired by the well-known, publicly-traded company WidePoint Corp.
The financial terms of the deal, which was announced earlier this week, include $8 million in cash, $550,000 warrants of stock and an additional earnout period of three years.
“As IT managed services, cloud, security and professional services are more relevant than ever before, it is absolutely pivotal to have a reliable partner to ensure the viability of these capabilities. We deliberately sought out a partner that shared our passion for service leadership in addition to a partner with a compelling slate of complementary IT services that would make us the preeminent powerhouse,” Jason Caras, co-founder and CEO of IT Authorities, said in the company’s news release.
IT Authorities has been recognized multiple times as one of the 5,000 fastest-growing companies in America by Inc.
Through the acquisition of Virginia-based WidePoint Corp. (NYSE American: WYY), IT Authorities expects to report annual revenue of more than $10 million in 2021.
“After a meticulous screening period, we found the ideal company in ITA because it adds accretive value across all facets of our business,” WidePoint CEO Jin Kang said in the news release. “We have already begun collaborating on sales opportunities with ITA, which we believe will translate to executed deals in the coming months. In conjunction with the immediate financial and sales benefits, we’re already seeing, our joint capabilities increase our value proposition in the market and correspondingly increases our chances of winning larger deals and contracts going forward.”
In a conference call, Kang described It Authorities as “a gem” and the company’s track record over the past 20 years, partnerships with Microsoft, and the company’s intangible culture played a major role in pursuing the acquisition.
He added that there are a lot of synergies between the two firms and that WidePoint can immediately tap into its expanding commercial SMB customer base.
Under the deal, IT Authorities has become a wholly-owned subsidiary of WidePoint. Caras will remain on as CEO. Co-founder Jason Pollner will assume the role of COO.
Foley and Lardner LLP acted as the legal advisor to WidePoint and Hyde Park Capital acted as financial advisor to ITA in acquisition.