iomart Group plc, a cloud computing company based in Glasgow, has agreed to acquire the whole of Extrinsica Global Holdings limited, a Microsoft Azure cloud solutions provider.

Extrinsica’s offerings include managed Azure Cloud, Azure solution design and implementation services, support and optimisation services and licensing.

The acquisition is in align with iomart’s “secure hybrid cloud strategy,” and will provide existing iomart customers with enriched skills to support their Microsoft needs, the company said.

Extrinsica was incorporated in 2010 as a cloud services provider, and in 2017 the Oxford-based company was invited by Microsoft to become one of the first 25 Microsoft Azure CSP partners worldwide.

The acquisition provides iomart with Microsoft Azure expertise, a team of 33 based in the UK, solid customer references, and a shared value and vision for how the Microsoft Practice in iomart should be shaped to support growth.

Simon Smith, CEO and Co-Founder of Extrinsica, will continue to lead the business as CEO supported by his team, while the company will be part of the iomart Group from a legal, financial, and governance perspective.

The initial consideration for the acquisition is £4m, with a potential further £0.3m available if key targets are hit during the year.

Of the initial consideration, £2m will be satisfied in shares in iomart, and the other £2m will be paid in cash.

The acquisition also includes a further £4m to £7m of contingent earn-out payments which are calculated based on Extrinsica’s profitability for the 12 months ending 31 March 2024.

Reece Donovan, CEO of iomart Group plc, commented: “We are delighted to welcome the Extrinsica team to iomart, providing a large step forward in iomart’s capabilities to support existing and new customers in their use of Microsoft’s Azure cloud platform.

“Simon and the team have been at the forefront of the market developments of Azure since 2017 and have deep skills and expertise in this in-demand area of cloud computing, which will accelerate the initial investments we have made in our own Microsoft resources and capabilities.

“This is a meaningful step in our strategy as we position the Group for its next phase of growth as a leading secure hybrid cloud business.”

Recommended

• DIGIT Movers and Shakers | May 2023
• FSB: Scotland’s Small Businesses Ready for Growth
• Report: Generative AI to Become Trillion Pound Market by 2032

Simon Smith, CEO of Extrinsica, commented: “Joining iomart marks an exciting phase for our highly skilled, experienced and ambitious team, providing us with a strengthened platform for growth. It allows us to leverage joint capabilities, capitalise on our understanding of the markets we operate in and build upon our significant achievements to date.

“iomart has a long pedigree in cloud infrastructure, an impressive customer base and a growth strategy which I believe positions iomart well for future success. The team and I are all incredibly excited to be working as part of the wider group and look forward to being a key part of driving iomart’s ongoing success.”