Iserv wanted a larger share of the market and saw a deal with EagleNet Inc. as a preferable way to accomplish its goals, Chief Executive Officer Victor Shepherd said.
“It’s really that simple. Why compete with each other when you can join forces and do it better than anybody?” Shepherd said.
“It just made perfect sense.”
The deal, signed early this month, gives Iserv a major slice of the ISP market in the Holland area, while providing EagleNet a partner with a statewide network, world-class data center and the resources it needs to provide customers a greater array of Internet services.
Among the new products Iserv was already planning at the time of the acquisition is accelerated Internet service that operates three to six times faster than dial-up service, but costs less than high-speed DSL, Shepherd said.
Iserv now is testing accelerated Internet service and will roll it out within about a month, with “in the neighborhood” of $5 more per month added onto a customer’s current rate, he said.
EagleNet will maintain its brand name and office in Holland serving the lakeshore area. EagleNet founder and President Rick Huizenga becomes a co-owner and investor in Iserv.
The acquisition creates a subscriber base of more than 40,000 residential and business customers who will benefit through better pricing and increased products and service offerings, Shepherd said.
“This is truly the case where the sum of the parts will be greater than the whole,” he said. “There were a lot of synergies.”
Iserv, founded in 1995, offers a variety of Internet and network services, as well as Web site server and application hosting and Web site design and development.
The Grand Rapids-based company has invested more than $5 million in recent years to upgrade its facilities and create a data center with redundant and reliable networks.
EagleNet was founded in 1996 and serves residential and business Internet customers, primarily in the Holland-Zeeland area, through dial-up and high-speed DSL service. It also provides Web hosting and co-location.
The acquisition will enable Iserv to better compete with large, national telecommunications providers while it focuses on niche markets and offering a high level of customer service, Shepherd said.
“There is certainly merit to gaining more clout as you grow and compete,” he said.
“When you start putting size together, it affords you that opportunity.”
Yet merely gaining size wasn’t the driving factor behind the acquisition of EagleNet.
Shepherd said Iserv saw the Holland company as having a similar corporate culture and business philosophy.
He said that, together, the two companies can “leverage the investments each organization has made over the past few years in technology and operations, while still retaining a high-touch, localized approach to customer service.”
“It’s not size, it’s service and what we do,” he said.
Iserv is constantly seeking new acquisition opportunities, although future deals hinge on the value they produce for the company and its clients, Shepherd said.
“We don’t want to acquire customers for just customers’ sake,” he said.
“Our plan is to continue to identify and affiliate with well-run, locally focused companies like EagleNet that can benefit from the investments we have made in the future.”