ATSG Closes Evolve IP Acquisition: Preparing For Growth, Looking For A New Name

‘What we're doing, the opportunity that drew me here, was to come in, take ATSG, Evolve IP, and a new management team—the best of the best from the two management teams—to create a next-generation MSP,’ says ATSG President and CEO Russ Reeder.

NEW YORK, February 20, 2025 /CRN News/ -- Last October, ATSG, a Manhattan, N.Y.-based MSP, said it would acquire fellow MSP Evolve IP. That plan has come to fruition as ATSG recently closed the acquisition and named a new executive team.

The result is a new global, profitable MSP with over 1,000 employees bringing in over $200 million in revenue, with a focus on security, network services, and desktop-as-a-service.

Indeed, the only thing missing now is the name of the new MSP, said ATSG President and CEO Russ Reeder.

“What we're gonna do with the new brand is bring these companies together and actually leverage one of our earlier names from an acquisition to have a new, clean, fresh brand that represents that premium-type, kind of white glove technology partnership experience for our customers,” Reeder (pictured) told CRN.

The acquisition creates a new MSP with the scale to meet the needs of not only its traditional midrange customer sweet spot, but also those of small business and enterprise clients, Reeder said.

“It's just amazing the velocity of change that companies aren't keeping up with,” he said. “They need a managed service provider that's on that leading edge to help implement AI solutions, implement bleeding-edge cyber security solutions to keep them secure, manage their network for uptime, and provide virtual desktops and call center solutions to keep them growing.”

There’s a lot going on at whatever the combination of AGST and Evolve IP will eventually be called. Here’s more of CRN’s conversation with Reeder.

What’s behind ATSG’s acquisition of Evolve IP?

I got a call last year to come in and run ATSG. They had an LOI [letter of intent] signed with Evolve IP, and I saw the opportunity to go there and raise funds to combine these companies. ATSG is acquiring Evolve IP from a technical perspective. But both have great momentum. We wanted to go out there with this merger from a managed services aspect as well as unified call center communications systems. We've got desktop-as-a-service solutions. We've got cyber security, managed cyber security, and we are a leader in both managed network services and desktop services according to Gartner. All of these are great opportunities.

We just closed the deal we originally announced on October 30. The main opportunity was to bring the management teams together to create a company that is going to be really like no other in the managed services space. In the past 15 years, we've all watched IT services businesses grow. Their roots have either grown from a VAR business, an IT managed help desk business, or from a consulting business. Private equity aggregated many of these different businesses and called them managed service providers. But there's really not another great example of a company our size now with north of $200 million in revenue and $50 million EBITDA that is a unified company with the systems and culture to scale.

If you look at the companies from $20 [million] to $100 million in EBITDA, most have been aggregated over the past 10 to 15 years and have silos of delivery based on the acquired companies. What we're doing, the opportunity that drew me here, was to come in, take ATSG, Evolve IP, and a new management team—the best of the best from the two management teams—to create a next-generation MSP.

Did the companies take in any funding to fund the acquisition?

We raised money from our owner, RunTide Capital. Also, Morgan Stanley on the secondary side is an equity investor. We also brought on debt.

How much funding has been put into the company?

Our last round was about $300 million in total debt and equity. And there's additional funding from previous rounds.

What will the merged company’s name be?

That's not part of this announcement. We have just announced the management team. What we're gonna do with the new brand is bring these companies together and actually leverage one of our earlier names from an acquisition to have a new, clean, fresh brand that represents that premium-type, kind of white glove technology partnership experience for our customers.

Is the merged ATSG and Evolve IT set up to be a platform MSP, that is, an MSP that aims to acquire other MSPs going forward to leverage increasing levels of scale?

That's correct. We’re setting up really a true platform. We're implementing Workday throughout as an ERP system. We're re implementing a new version of Salesforce. We’re integrating two different ServiceNow solutions. We're implementing processes and performance management systems to track goals and performance within the company. So we're doing all the things necessary to scale from $200 million in revenue to $500 million to $1 billion.

What you just mentioned regarding Workday, Salesforce, and ServiceNow, you're talking about your internal processes, right? Who are some of the key vendor partners that your company is bringing to customers?

We work with Cisco, Microsoft, Citrix, VMware, as well as a lot of other high-tech providers.

Now that the acquisition is closed, how long do you think it will take to do the integration of the two companies?

This year, we're moving fast. We've started all the work that I've just mentioned. A majority of this integration will be done by the end of calendar Q3.

Have you pretty much solidified the management team going forward? Any gaps?

No. We have an amazing management team that has experience in the MSP world at every one of their specific roles and responsibilities to deliver on our vision.

Evolve IP’s former CEO Jeff Coursen is leaving the company, right? Why didn't he stay?

His goal was to leave the company. He was the CFO and acting CEO.

What are the key things that we need to know about the new executive team?

Half the team is from ATSG, half the team from Evolve IP. They all have very deep experience in the MSP world that will ensure we complete the integration and continue to grow organically and inorganically

Where is the new company located?

We're based in New York, in Manhattan. We also have offices in Tampa, Philadelphia, outside of London, and in Rotterdam in the Netherlands. We have employees in the western U.S., but everyone's working from home anyway. Most of our business is throughout the U.S., but we have thousands of users around the world through hundreds of global companies.

Do you have any U.S. Federal government business?

Zero federal government business, I'm happy to say. We do have state and local higher education. So obviously there's some concern about their funding, but we are very optimistic about this year within our verticals including retail, manufacturing, healthcare, and the finance industry.

The news now is the merger of ATSG and Evolve IP. How many other companies were combined to make those two companies before the final merger?

ATSG has acquired 14 companies since its founding 15 years ago. So we've grown through acquisition. And Evolve IP has acquired seven. We're looking to acquire other managed service providers, IT service providers, that have good relationships and provide good managed services for the mid-market.

How many more acquisitions do you expect to close this year?

I'm not sure. Right now, we are heads-down on the integration work. But come this summer, we may have some bandwidth.

Do you have enough funding to reach your goals for organic and organic growth?

We do.

What is the combined company doing in terms of bringing AI and its related services to customers?

We’re not only using it internally for AI agents, we have an AI advisory group out of our professional services organization. We're sitting down with a lot of our customers to help them evaluate where they can benefit from this agentic future. And we're helping implement those solutions as well.

What are your strategic goals for 2025 besides integrating the merged company?

At every town hall we talk about our four main goals for the company, which are literally around people: our employees, our customers, internal processes, and hitting our top line and bottom line. Creating a culture where people are engaged is very important for us. Our main priority is to have a productive and engaged workforce. The second goal is turning customers into evangelists. You have to deliver above and beyond your promises. To do that, the third goal is implementing processes and systems to scale. And the fourth is top-line and bottom-line attainment.

Anything else that you think we need to know about ATSG and Evolve IP, aside from the final company name, which you are not yet going to disclose?

What makes a company successful is delivering on its promises. Customers want to make sure that you can deliver on what you've said you can. Employees want to feel like they're at a company that's succeeding. It all comes down to culture, and we're focused on a culture of performance, accountability, and respect to make sure that our employees work together to deliver a premium, white glove service to our mid-market customers. We have enterprise and smaller customers as well, which usually happens when you focus on the mid-market. … We have customers with tens of thousands of desktops that use our desktop-as-a-service offering. We’re seeing a tremendous uptick there. Traditionally, I think companies only wanted to keep their desktops in case their internet goes out or if they're on a plane. Pretty much every application they use is a web-based application anyway. We've seen a rise in desktop-as-a-service, where corporations want the simplicity, the security, and the cost savings of virtual desktops so people can bring their own device, they can all be on the same software versions, and they can manage all of these thousands of desktops out there.

With the evolution of AI, we're pushing AI internally as well. We're building AI agents to help train our call center, to help train our salespeople, to provide coaching lessons, as well as act as a virtual coach while they're on calls to make sure we can deliver a higher level of service. We have also just launched a whole new cyber security managed platform that helps customers track their brand and their credentials on the dark web. That helps make sure all their compliances and certifications are up to date and that they're staying ahead of AI cyber threats, which most companies, to be honest, aren't.

It's just amazing the velocity of change that companies aren't keeping up with. They need a managed service provider that's on that leading edge to help implement AI solutions, implement bleeding-edge cyber security solutions to keep them secure, manage their network for uptime, and provide virtual desktops and call center solutions to keep them growing. So we're really excited.

We offer full service. We're not just focusing on one small niche. We are building these platforms with everything from being able to get a better price on the equipment to installing it, servicing it, to managing the service all the way through cyber security. I think there are few providers that can deliver like us.

About ATSG

ATSG is a leading global managed services provider, delivering award-winning digital transformation services to today's dynamic enterprises. Its robust portfolio of premium managed services includes Cloud, desktop-as-a-service, Network, Operations, and Cybersecurity services. Headquartered in Manhattan, New York, ATSG is a portfolio company of RunTide Capital, a private equity firm focused on building tech-enabled growth companies.

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