Frontline Managed Services lining up potential acquisition targets that would bring capabilities, talent or key geographies, said CEO Seelin Naidoo.

Mergermarket, Calvin Trice 
By Calvin Trice

The St. Louis-headquartered firm plans to use growth investment from new majority owner Broad Sky Partners to buy firms that can add point solutions to help build out its services, Naidoo said.
 
Frontline would also be interested in companies with unique software that could aid service delivery or client operations, he said.
The firm expects to make a significant investment into a generative artificial intelligence (AI) platform agreement and would look at targets that help that initiative, Naidoo said.
 
Frontline wants to gain geographic footprints in California, Texas, Atlanta and South Florida where the legal business is robust and growing. The firm would also like to develop its UK presence with a managed service provider there, which could also come via M&A, Naidoo said.
 
Among Frontline’s targets, a solid customer base will play a crucial role for things like length of service, delivery model and satisfaction level, the CEO said.
 
Frontline has made six acquisitions since its founding in 1987, with the last four coming since 2020. It has six potential targets in its pipeline and hopes to close its next deal within 180 days, Naidoo said.
 
The company plans a two-pronged acquisition strategy that will on one end target tuck-ins with about USD 5m in revenue and USD 1m-USD 2m in EBITDA. On the other end are players that are private equity or partner-owned with USD 20m in revenue or up, Naidoo said.
 
The Broad Sky investment has made Frontline well-capitalized for its strategy, and the firm won’t favor one end over the other, he said.
“My sense is, what are we getting out of each, and does it fulfill what we consider to be our strategic direction,” says Naidoo.
Frontline serves more than 800 law firms out of nine locations in North America, the UK, and India – processing more than 80,000 invoices per month, said Naidoo, who declined to provide company financials.
 
Headcount stands at about 1,000, nearly half of it is offshore customer support personnel.
Frontline earns revenue from service contracts that last three to five years, and 92%-93% of it is recurring, the CEO said.