CMIT Solutions, a leading MSP franchisor with headquarters in Austin, Texas, announced last week that private equity firm HKW has acquired the company with a transition of ownership from Craftsman Capital. HKW also acquired one of CMIT’S largest MSP franchisees, HTW, based in Cranston, R.I.
Growth and the ability to serve larger clients are the two main reasons for the acquisition, according to Amy Luby, vice president of operations for CMIT Solutions, which has over 250 locally owned franchisees nationwide and in Canada. “HKW is a larger firm than Craftsman Capital and has more resources. They are super interested in helping us grow and will expand our potential capabilities for delivering our system and increase fulfillment services to new franchisees. This will allow those franchisees to get established more quickly. HKW also has the resources to purchase more corporate affiliates.”
When Luby joined CMIT in September 2022, there were four companies bidding to transfer ownership of CMIT from Craftsman Capital, which acquired CMIT three years ago. “Roger [Lewis], our CEO (pictured), set a goal to reach $100 million, and we hit that goal last August,” a year ahead of the projected timeline, notes Luby. The next goal is $200 million in systemwide revenue by 2028.
The acquisition also strengthens CMIT's ability to support larger enterprise customers with the new corporate affiliate of HTW, says Luby. One of CMIT’s top-performing franchisees, HTW has the existing capacity to serve multi-location accounts. A central team of IT and security professionals will provide clients with support for larger and more complex projects. Additionally, these resources shared among franchise locations will enable the company to better support clients who need specialized expertise.
“HKW shares our goal of accelerating our company’s growth while creating more value for our clients,” said Lewis in a press statement. “Their expertise and support will be instrumental as we achieve the next phase of our maturity through new initiatives in marketing, sales, and operations, including adding centralized fulfillment capabilities.”
Based in Indianapolis, Indiana, HKW invests in profitable middle-market companies in the technology sector. As a rapidly growing IT and cybersecurity organization, CMIT is strongly aligned with HKW’s investment focus, according to the company. Since 1982, HKW has sponsored 69 platform transactions of middle-market companies throughout North America and 75 add-on acquisitions.
“The MSP and cybersecurity industry continues to expand as businesses seek solutions to address increasing cyber threats and IT complexity,” Daniel Kim, partner at HKW, said in a press statement. “We recognize the tremendous opportunity in front of CMIT. We’re excited to be part of helping the company build its scale to meet the growing demand for technology and security services in the coming years.”
The financial terms of the transaction were not disclosed.