Telecommunications company EarthLink, in an attempt to pare down its business and focus its efforts as an organization, has sold its information technology division to Synoptek.
Synoptek, a managed IT support services company, will experience some big changes as a result of this acquisition. As a worldwide provider of IT services, it only had about 400 corporate customers to its name. EarthLink’s division of those same services was much bigger, at around 1,700 customers (of which many reportedly operate on the east coast of the U.S.), so the addition of EarthLink personnel and clients will cause Synoptek’s core values to surge.
Both sides of this deal seemed excited about the development. Tim Britt, the CEO of Synoptek, commented:
“This acquisition helps us continue our mission to become the best independent IT managed service provider in the market, and it supplements our ability to provide expert IT leadership and support services to our customers.”
Joe Eazor, the CEO and president of EarthLink, further noted that his company’s IT services department has been successful and should be a great help to Synoptek in all its future endeavors.
According to media reports, this addition of personnel and clients will also come alongside the acquisition of data center space that will support those groups. EarthLink will also drop about 210 employees who, it is expected, will continue their careers under the Synoptek banner.
What this means for EarthLink is exactly the opposite of those figures. The loss of its IT services division – a calculated move – will shorten the list of company offerings so it can focus on what has made it the most money: networking. IT services only collected about three percent of annual company revenue in 2015, so that piece of the puzzle, though 17,000 customers strong, is not as big as it might seem.
EarthLink’s networking services may come in the form of on-premise or cloud-based networks that can handle secure transmission of voice and data as part of a client’s daily inter-office communications and contact with clients. As specialization become more important, reports may even see EarthLink drop other services that do not provide a substantial amount of revenue. This deal brought it only about $29 million up front. The increased focus on networking should more than pay for its release.