The tech world is in a consolidation frenzy – mergers and acquisitions have reached a record level. Two iconic Detroit-based tech firms have been swept up in the M&A action. Dan Gilbert’s Rocket Fiber and Compuware have been involved in M&A.
Rocket Fiber, an internet service provider based in Detroit and owned by Dan Gilbert, has been sold to Everstream. The Cleveland company announced it would be acquiring Rocket Fiber, in an effort to expand its network of over 13,000 route miles into the Detroit market. Everstream already operates in parts of Michigan, including Lansing and Grand Rapids.
The Rocket Fiber acquisition includes:
- 41 route miles of fiber network in greater downtown Detroit.
- Two offices in downtown Detroit, including more than 75 team members.
- All Rocket Fiber clients will continue to receive all services without disruption.
- Direct connection to Everstream’s existing fiber network infrastructure in Michigan and its other Midwest markets.
When Rocket Fiber was founded in 2014 by Marc Hudson, Randy Foster, and Edi Demaj, access to fiber-based infrastructure was extremely limited in Michigan and non-existent in Detroit.
Rocket Fiber’s goal was to offer faster and more reliable internet solutions in the city. In 2015 they secured funding from Dan Gilbert – who shared their goal of providing Detroiters and Detroit businesses with dependable, unrestrained connectivity and helpful, authentic client service for the community – and began to install miles of brand-new fiber-optic cable throughout the city.
Rocket Fiber provides gigabit-speed internet to some of the city’s most highly trafficked spaces including Ford Field – home of the Detroit Lions, Greektown Casino-Hotel, the QLine, and the home of the North American International Auto Show – TCF Center (formerly COBO). Marc Hudson, CEO, and Co-Founder, Rocket Fiber said for the presser:
What began six years ago as a moonshot idea to leapfrog Detroit’s technology infrastructure has come full circle as we’ve matured into a rapidly growing and profitable business. By joining Everstream, our customers have access to the same incredible client service along with the added benefit of Everstream’s much larger Midwest footprint.
Compuware, one of Detroit’s original tech firms which provides mainframe application development, delivery, and support is being acquired. BMC, a KKR portfolio company and a provider of IT solutions for digital enterprises announced its intention to acquire Compuware from Thoma Bravo company.
This is BMC’s third acquisition in less than two years. It is expected to be one of the largest. BMC states it continues to focus on investing in innovative and disruptive technologies. The financial details of the transaction were not disclosed.
Compuware customers include Amtrak, Cigna, and Neiman Marcus. BMC has the third-largest mainframe business behind CA Technologies and IBM. Thoma Bravo acquired Compuware in December 2014 in a $2.4-billion leveraged buyout. Compuware was once the largest tech company in Michigan. The company had as many as 15,000 employees around the globe at its 2000 peak. Between 500 and 1,000 employees are believed to work there now.
BMC and Compuware declined to comment when the Detroit Free Press asked if the company plans any layoffs or relocations of Compuware employees. The representative also didn’t comment on whether the deal will add a significant debt load to Compuware, which often happens to the acquisition targets of private equity deals.
Compuware was founded in 1973 and relocated from Farmington Hills to downtown Detroit in 2003. The firm was the first major business to move from the suburbs to downtown Detroit in the 2000s. Compuware constructed its Detroit headquarters building near Campus Martius at a cost of $350 million, which was far more than what the building sold for a decade later.
BMC states the combination of BMC and Compuware will build upon the BMC Automated Mainframe Intelligence (AMI) and the Topaz suite, ISPW technology, and product portfolios from Compuware to further modernize the mainframe industry. Compuware CEO Chris O’Malley says,
Without a doubt, a combined BMC and Compuware is the best, brightest, and most collaborative partner for a new generation of mainframe stewards.
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This is the sad part about most successful companies – they grow up and move on. But sometimes leaders stick around. Peter Karmanos is a pioneer in Detroit tech. He founded Compuware in 1975.
Mr. Karmanos has a new cloud tech venture MadDog Technologies based in metro Detroit. He donated $15 million to the Michigan Cancer Foundation, which was renamed the Barbara Ann Karmanos Cancer Institute in memory of his first wife, Barbara Ann Karmanos which located in Detroit.
Dan Gilbert, who was born in Detroit and still lives in the area founded Rock Financial in 1985. Rock Financial grew into one of the largest independent mortgage lenders in the U.S. In the late 1990s, the firm pivoted to a web-first firm and became Quicken Loans. By 2018, Quicken Loans had become the largest retail mortgage lender by volume in the U.S. while staying in Detroit.
Quicken Loans moved its headquarters and 1,700 staff to downtown Detroit in August 2010, where Mr. Gilbert’s firms leading a revitalization of Detroit’s urban core. Gilbert-owned businesses employ more than 17,000 people in the city. Since 2011, Mr. Gilbert’s Bedrock Detroit has purchased 100 properties totaling over 18 million square feet in Detroit.
Mr. Gilbert is partnering with the University of Michigan to build a high-tech research campus at the eastern edge of downtown Detroit. The anchor building will the $300-million, 190,000-square-foot – Detroit Center for Innovation on Gratiot Avenue.
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Ralph Bach has been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedIn, Facebook, and Twitter. Email the Bach Seat here.
he article says today, Comcast charges $399.95 a month for its 505 Mbps tier. An Ars Technica report said Comcast’s 2 Gbps service will cost less than that. It also said that all 505 Mbps customers will be upgraded to the new Gigabit Pro service. As the MSO tries to work out pricing, it decided to delay the initial May release of the service in Detroit to a new, undetermined date.
