G3 acquires 2e2 company Diagonal

SAP consultancy G3 Global has completed a cash-funded acquisition of former 2e2 company Diagonal Consulting.

Diagonal was founded in 1986. It is a systems integrator that provides SAP implementation and consulting services for customers across Europe, the US and Africa.

It was acquired in 2004 by IT services company Morse for £50m. In 2010, it was then transferred to 2e2, when the now-collapsed systems integrator completed the acquisition of Morse for £69.8m.

2e2's administrators FTI Consulting have agreed to support the transition of Diagonal customers and its trademarks to G3.

Weybridge-based G3 Global's CEO Chris Gunter believes that the acquisition will help it build a greater presence in the US and yield other benefits.

"The leadership Steve Woodgate and his Diagonal team bring to the table adds significant value to our global and local customer base," he said.

"There is excellent synergy between G3 and Diagonal, a matching of minds and business ethos that benefits employees of both companies, not to mention a strengthening of capabilities that will make the united customer base very happy."

Diagonal president Steve Woodgate added that he was "very excited to join the G3 family" to "have a home in a large organisation with such an incredible alignment of culture, methodology and management".

G3 said that it has tried to help many 2e2 customers by offering access to the G3 Global helpdesk function in addition to deploying resources to develop transition plans. It has been helped by a significant number of the 2e2 delivery team and support team joining G3 Global after being made redundant by 2e2.

2e2's collapse meant that nearly 1,000 staff were made redundant by the first week of February, about 345 of whom were left unpaid for January with no redundancy pay.

Other staff could have suffered a similar consequence before O2 took over 2e2's managed services business. Meanwhile, the datacentre business of 2e2 was acquired by Oakley Capital Private Equity, who then appointed communications company Daisy Group to manage both of 2e2's datacentres.

The bankrupt systems integrator has been placed under serious scrutiny since its collapse, with ex-employees revealing their disgust at the way they had been treated and rumours circulating on how a firm which had customers such as Vodafone and Kellogg could fall from grace so abruptly.

The Serious Fraud Office (SFO) refused to "confirm or deny" whether it was investigating 2e2, while FTI Consulting responded to Computing's query of whether it was being investigated by stating that it had "no comment" to make.