VAR M&A: Solutions II Acquires CMI In Data Center Modernization Play

Solutions II on Wednesday said it has acquired fellow solution provider Chouinard & Myhre Inc. in a deal aimed at expanding the company's reach and its ability to help bring legacy customers' data centers into a more digital world.

CMI will bring Solutions II 20 employees, a California presence, and its Adaptable Data Center practice, said Todd Bowling, president and CEO of Littleton, Colo.-based Solutions II.

"ADC, or Adaptable Data Center, is CMI's framework for helping customers move their data centers to the digital world," Bowling told CRN. "A lot of our customers struggle with that move. We want to help clients digitize faster."

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Bowling declined to discuss financial details of its acquisition of CMI, which is based in Mill Valley, Calif., just over the Golden Gate Bridge from San Francisco.

For CMI clients, the acquisition also brings a wide range of services from Solutions II, Bowling said.

"It's a great fit for both companies," he said. "This is about skills, scale and focus that will help clients on both sides of the fence."

CMI is Solutions II's fourth acquisition. The company purchased a Salt Lake City, Utah-based solution provider named Vista so many years ago that Bowling could not remember the year.

That was followed by the acquisition of Vancouver-based solution provider Blue World. Again, Bowling did not recall the date of that acquisition, but he did remember the lessons learned from it. "It was a failed acquisition," he said. "We unwound it. Culturally, it did not mix with us. That was some time ago. It was a learning experience for us."

Solutions II in 2015 acquired South Seas, a security-focused solution provider which now accounts for about 30 percent of the company's total revenue, Bowling said. The former owner of South Seas is still with Solutions II, he said.

"That lets us bring more security and compliance capabilities to CMI's customers," he said. "Security now accounts for over 30 percent of our overall revenue. It's been a good business for us."

Steve Giondomenica, CEO of CMI, is planning on remaining with Solutions II, Bowling said. Giondomenica started with CMI over 20 years ago as a sales rep, and eventually purchased the company.

"Steve's not looking to retire yet," he said.

Bowling said he and Giondomenica have known each other for several years via industry events and partner councils. The two started talking about the possibility of combining their companies in mid-2018.

"These types of conversations occur usually over a cup of coffee," he said. "For us, it was during a meeting of channel partners that we trust. We started talking about the future, and Steve said sort of makes sense to get together."

Both Solutions II and CMI are profitable companies, Bowling said. He anticipates nearly all of CMI's employees to join Solutions II. "But there's always one or two who don't think an acquisition is the right fit for them," he said.