Savvis (news, filings) [a subsidiary of CenturyLink (NYSE:CTL, news, filings)] is purchasing the IT outsourcing business of Ciber, giving it greater muscle on the services side of its business to go with its colo and cloud infrastructure. The two companies have been working together since partnering last summer.
The transaction will cost Savvis $7M in cash, plus an additional cash earn-out payment based on results through December 2013. Additionally, 750 employees will move over to Savvis from Ciber. The acquisition will expand Savvis's capabilities for application management services and help desk support.
Service providers aiming at the enterprise via the cloud have been actively acquiring assets such as these in order to quickly boost their market position. The IT outsourcing industry has been moving inexorably to the cloud, but there's a lot of work to do yet for service providers to find the right balance.
For its part, Ciber is narrowing its focus, and will continue to provide its clients with full lifecycle application development and outsourcing solutions