By Jim Lundy
Alfresco, under the leadership of new CEO Jay Bhatt, has wasted no time adding more solutions horsepower to the Alfresco portfolio by scooping up Chicago-based Technology Services Group (TSG), a provider of enterprise content management systems. This blog evaluates how this deal will benefit Alfresco.
Who Is Technology Services Group?
TSG is a software and services firm that is based in Chicago. Aragon estimates that TSG revenues were under $10 million. It offered a number of content management services to existing customers that include solutions for insurance and construction industries. It was also building competencies on migrating enterprises off of legacy enterprise content management platforms by leveraging Amazon AWS and NoSQL based architectures.
After the deal is done, Alfresco indicated that it would continue to operate as TSG. Aragon expects them to be integrated over the next 12 months.
Alfresco’s new TSG acquisition may be the start of a larger acquisition phase.
Why Did Alfresco Buy TSG?
Our take is that while TSG has a number of services, its case management offering and its services capabilities provide Alfresco with a set of proven industry solutions that should contribute cash generation to Alfresco, which already has a document management system offering. TSG claimed a staff of 45 people who can work with customers to get implementations done. As a digital business platform provider, Alfresco has a reason to invest in these capabilities to expand its digital platform strategy.
Bottom Line
CEO Jay Bhatt is wasting no time tuning up Alfresco and adding new solutions to the portfolio. While there may have been other options for Alfresco to acquire, we expect this deal to be additive to revenue, so there is no downside. We also expect that this is the beginning of an acquisition phase for Alfresco, as the opportunity for migrations away from other legacy ECM providers represents a growth opportunity.