Despite Verrex‘s nearly seven decades of success and continued growth into one of the established industry leaders, CEO Thomas Berry Jr. always wanted more out of the Mountainside, N.J.-based family business. He also wanted to make sure that family—which extends to Verrex’s employees—is well taken care of with a secure future.
“When you’re a little guy like us, you get boxed out of a lot of opportunities,” Berry told Commercial Integrator earlier this year for a story on global expansion. “We had to go out and find those partners ourselves. We found a whole bunch of ‘Verrexes’ around the world.”
Always with an eye toward being one of “the big guys,” Verrex announced exclusively to CI today that it’s been acquired by an institutional investment group led by Five Crowns Capital. The deal coincides with the retirements of Berry’s father and uncle.
Watch Tom Berry Jr. discuss the acquisition of Verrex by Five Crowns Capital with CI editor Tom LeBlanc:
It’s a move that “underlines the integrator’s prominent place in the AV market,” according to the Verrex release on the acquisition.
Debt and equity investors in the Verrex acquisition include Diamond State Ventures, Aavin Private Equity, MidStates Capital, and Enterprise Bank.
The deal “will provide additional working capital and growth expertise for the expansion of Verrex’s global presence, AV system integration and managed services capabilities, and suite of collaboration products,” according to the announcement.
“The breakneck pace of technological AV innovation in the workplace is astounding,” said Berry in the Verrex announcement, which notes no changes will be made to the senior management team as part of the acquisition.
“Since our founding nearly 70 years ago, Verrex has aligned its capabilities and solutions with the way people want to work,” said Berry in the announcement. “We continue that alignment with partners who believe in our ambitious vision and who have the resources and expertise to see it’s achieved. This new milestone also culminates two years of careful succession planning.
“As I continue to build on my family’s legacy, I am grateful to the prior generation for their leadership and devotion. I am excited to guide Verrex into the next stage of its growth, and to give these fearless entrepreneurs the retirement they rightly deserve,” said Berry. He noted the annual CI Summit was a good place for him to scout potential partners in the past.
Verrex is the second large integrator acquired by a private equity firm in the past few months, joining AVI-SPL, which was scooped up by H.I.G. Capital in April.
Founded in 1947, Verrex has “extensively served the needs of The Global 500,” according to the announcement, once again earning a spot on the 2016 CI Industry Leaders in the corporate market.
The acquisition “will allow Verrex to further strengthen its relevancy to this enterprise market, as well as middle market and SME segments,” according to the announcement.
“Verrex is the ideal combination of a multi-generational business that has built a strong culture combined with an unusually talented management team,” said Jeffrey Schaffer, founder and managing partner of Five Crowns Capital, in the announcement. “The company has a long history of providing exceptional services to some of the most demanding multi-national corporations in the world. Their culture and expertise position the company well for significant future growth, both organically and through strategic acquisitions.”
Maybe this move will mean less traveling for Berry, who remains as CEO with the newly formed Verrex LLC. He’s seemingly been on a plane to somewhere for the past seven years, when Verrex stumbled into becoming a global company as the clients it serves expanded around the world.
Clients told Verrex to open facilities around the world, and like they always have, Verrex listened to its customers, says VP of global sales Bill Chamberlin. The move to open facilities around the world was made with an eye toward providing overseas customers the same level of support and system design it had done for decades in the U.S.
The so-called Great Recession of 2007 and 2008 led to some struggles for Verrex in terms of keeping up their global presence, eventually seeing them close offices in the U.K., Hong Kong, Mumbai, Shanghai, Sydney, Tokyo and Singapore offices as part of a restructuring process.
“Rolling it out in the headwinds of the global recession, we took our lumps,” Berry says. “We lost money. An investment was made heavily in 2010, 2011 and even into 2012.”
In early 2015, Verrex announced the opening of an office in Shanghai and the company continues to work with a network of global partners to meet its customers’ needs today.
“We still have our ups and downs, but the reality is that the foundation was put in place,” Berry says. “We’ve been able to execute a global model successfully, profitably and to quiet satisfaction.
Could the acquisition mean Verrex will have to rely less on its competitors to win the big jobs it’s landed with their help in the past? Only time will tell, but something tells us this won’t be the last big deal involving one of the industry’s most successful integrators for going on seven decades.