August 25, 2025: Dallas, TX and Los Angeles, CA – Solganick has issued its latest mergers and acquisitions (M&A) report covering MSPs and MSSPs.

You can download the full report here:

Solganick Managed Services Providers and MSSP M&A Update YTD 2025

Here are the highlights of the report:

Managed Services Providers (MSPs):

The MSP M&A market saw a notable rise in deal activity in the first two quarters of 2025 compared to the previous quarters. April and May were particularly active, while June experienced a lighter deal flow.

The market rebounded following a modest start to the year, reflecting renewed confidence from buyers and sellers.

Premium valuations were paid for MSPs with strong organic growth, scalable operations, and robust client relationships, with some recording ~20x EBITDA exit multiples for larger platforms. Weaker or less differentiated assets struggled to attract interest or maintain valuations.

• Private Equity Drives Activity: Interest from private equity funds remained robust, particularly in transactions where the target demonstrated predictable revenue streams and scalable services.
• Sustained Momentum Expected: Industry voices expect strong M&A activity to persist into the second half of 2025, supported by ongoing tech adoption, digital transformation, and the sector’s resilient fundamentals.

MSP M&A Transaction Profile: Abacus Group and Medicus IT merge to create a leading MSP within the financial services and healthcare sectors.

Details: In July 2025, FFL Partners, the PE owner of Abacus Group and Medicus IT, announced that the two MSPs have officially merged into a single managed service provider that exclusively serves the needs of the financial and health care industries. The terms of the merger are undisclosed.

Managed Security Services Providers (MSSPs):

YTD 2025 has recorded notable acceleration in M&A activity within managed security service providers (MSSPs).

The market was fueled by heightened enterprise demand for advanced security capabilities, continued threat complexity, and a surge in interest for AI-driven and integrated security solutions.

Investors and strategics concentrated on platform innovation, especially in cloud security, AI-native threat detection, and managed security expansion.
Q2 2025 logged 40 M&A transactions in cybersecurity services, with strategic buyers consolidating specialized MSSPs and consulting firms to bolster their offerings.

• Rising Deal Values: Average deal size increased substantially, pointing to larger, more strategic consolidations—especially for firms with advanced technology and cross-platform capabilities.

Acquisitions of MSSPs remained prevalent, reflecting demand for end-to-end security operations and access to clients in highly regulated industries.

Examples: LevelBlue’s acquisition of Trustwave, Abacus Group’s acquisition of Entara, and Evergreen’s acquisition of ImageQuest.

AI-Driven Security

Agentic AI and LLM Security: Several deals targeted agentic AI, natural language processing, and large language model (LLM) research, with acquirers integrating advanced AI to bolster automation, threat detection, and cyber defense.

Examples: F5’s acquisition of Fletch (Agentic AI), Rubrik’s acquisition of Predibase (open-source AI modeling), and Snyk’s acquisition of Invariant Labs (AI security research).

About Solganick

Solganick is a data-driven investment bank and M&A advisory firm exclusively focused on software and technology services companies. Its MSP/MSSP M&A practice is well established as a leading M&A advisor to fast-growing and established MSPs, including PE-backed MSPs.

For more information on Solganick or its MSP/MSSP M&A advisory practice, please contact us.

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