Digital West Networks Inc. has acquired Norcast Telecom Networks to create what they’re calling the Central Coast’s single largest business infrastructure provider — with about 60 employees and more than 2,500 customers ranging from small businesses to Fortune 500 companies.
The privately held firm declined to disclose terms of the deal, which was struck last November but announced Tuesday. The firms expect to be fully integrated within six months, according to Tim Williams, who will be CEO of the new company.
Williams founded Digital West in 1998 as an internet service provider with only a few servers. Now, the company occupies a 2,000-square-foot-data center in San Luis Obispo and offers various data infrastructure services through offices nationwide and overseas.
Norcast Telecom began providing telephone services in 1999 and telecom services — including phone, Internet access and data transport — in 2003.
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The two companies have worked closely together for more than 10 years — with many of the same customers — and have talked on and off about merging during that time, according to Norcast President Jeff Buckingham. Both companies have about 30 employees and share common values, including a commitment to innovation, fostering win-win relationships and extensive community involvement, he said, adding that the acquisition is a true collaborative effort.
Buckingham will become the combined company’s president and chief client officer. Michael Boyer will remain as chief operating officer and Sandy Davis will remain chief financial officer.
We will be reaching out to hire new people, especially in the southern parts of the Central Coast.
Tim Williams, who will be CEO of the new company
Michael Gayaldo, CEO and majority shareholder of Norcast, who said he led the team there to 260 percent growth over seven years, opted to sell his shares and step down once the merger is complete. He plans to spend more time with his family while contemplating his next business move.
All employees from both companies will be retained, and the company plans on hiring more personnel as it expands.
“We will be reaching out to hire new people, especially in the southern parts of the Central Coast,” Williams said.
Executives at both companies agreed that combining the resources of Digital West and Norcast will simplify and improve the services they provide clients. The newly integrated company will be able to offer world-class cloud services, advanced technologies and telecom services that will keep Central Coast businesses competitive both locally and globally, they said.
“It’s already difficult for Central Coast businesses to be major players in the international market. We will now be more of a one-stop shop for our clients,” Williams said, noting that customers will have one place they can buy all of the different services the two companies used to provide separately.
Digital West also will increase its minimum fiber optic speed to 100 megabytes per second from 50. The increased customer base that came as a result of the merger means Digital West will have to greatly expand its fiber optic network to provide higher connection speeds, Williams said.
“Our biggest challenges will be logistical,” Buckingham said. “We will have to learn each other’s businesses and begin working in the same location. We should have everyone together by the end of next week.”
About 70 percent of the company’s clients are based on the Central Coast, and more than 100 of those clients are nonprofit organizations. Both Buckingham and Williams declined to disclose total annual revenues. Buckingham noted that both companies have been profitable.
Both Digital West and Norcast were privately owned companies. Williams will remain the company’s majority owner, while Buckingham will become a minority owner. Neither Williams nor Buckingham would disclose more specific ownership or financial information.
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