Phoenix IT Group acquires KCOM network break fix arm

Phoenix IT Group has confirmed that it has acquired the contracts held by KCOM's network maintenance arm for £1.8m.

Under the terms of the deal, revealed by MicroScope last week, 142 staff will transfer from KCOM to Phoenix to provide field engineering services for their managed services customers on a multi-year agreement from March 2010.

The acquisition of KCOM's Aghoco 1000 Ltd subsidiary contains field maintenance contracts that will be managed by Servo, Phoenix IT Group's mid-market services division.

"This important outsource agreement and acquisition of new contracts will greatly strengthen our long established position in the Network arena," said Phoenix chief executive Nick Robinson in a statement.

The business, which became part of KCOM when it acquired Omnetica in 2004 works with Cisco and Nortel and is estimated to turn over around £15m a year.

The 300-strong customer list includes HSBC, Lloyds TSB, DEFRA and the University of Dundee.

"The multi-platform skills that we are acquiring will significantly enhance our capabilities in this area and will enable us to expand our activities into voice support and to take full advantage of the growing trend for converged technologies," he added.

Aghoco is being acquired on a cash and debt free basis to be paid on completion and Phoenix expects the unit to be profitable from the outset.