Two Iowa-based companies that provide telecommunications and human resources services to businesses are merging. Iowa Network Services based in West Des Moines has announced the purchase of Merit Resources company of Urbandale. INS president and CEO, Ron Keller, says the purchase made a lot of sense for his company.
“First of all, it allows us to provide our shareholders — who are 122 independent phone companies across Iowa — with a new service to allow them to look the potential for reducing their costs and minimizing their risks associated with H.R. related activities. And allow them to focus on their core business of providing communications services to their communities,” Keller says.
Keller says the acquisition fits in with the company’s long-term plan to broaden the services it provides beyond communications to a variety of business services for small to medium size businesses. “It also creates opportunities for cross selling between Merit’s customer base and the customers that we have — not just at Iowa Network Services — but also for Alliance Technologies, for which we are a majority shareholder,” Keller explains.
Merit , Joel Duncan, says the company faces some challenges, especially with providing services to companies as the federal Health Care Act moves forward. “It was really looking at what are the hurdles that we’re going to cross as this growing complexity of employment is happening,” Duncan says.
“National health care is just one optically in front of us right now that’s the most onerous for small businesses to comply with that’s going to fuel a lot of our growth as we look to the future,” Duncan says. Duncan says the purchase by INS gives them the capital they need to move ahead with the growth.
INS has around 225 employees, with around 100 at Alliance Technologies and Merit has 75. Keller doesn’t expect any changes with the acquisition. “As part of the valuation and looking at Merit, we had no considerations for expense reductions, so there are no anticipated reductions in workforce as a result of this,” Keller says.
“So, it’s really one of those feel-good stories about two long-term financially successful Iowa-based companies coming together and building a platform for profitable growth for both parts of the organization.” The terms of the sale were not released.