NewSpring Sells Magna5 to AEA After 8x Revenue Growth

RADNOR, Pa. – February 03, 2026 – Private equity firm NewSpring announced today the successful sale of its managed IT services platform, Magna5, to AEA Investors. The transaction marks the culmination of a highly successful partnership that saw Magna5 transform from a regional player into a national powerhouse, boasting an eightfold increase in managed services revenue and positioning it for continued dominance in the rapidly consolidating IT services market.

The sale to AEA Investors, a global private investment firm with a long history of backing middle-market companies, signifies a new chapter for Magna5. Financial terms of the deal were not disclosed.

A Blueprint for Building a National Platform

NewSpring’s exit is a textbook execution of its "buy-and-build" investment thesis, a strategy focused on scaling businesses in fragmented, lower-middle markets. Over the course of its investment, NewSpring Holdings—the firm’s majority investment arm—worked methodically to institutionalize Magna5’s operations and aggressively expand its market footprint.

A cornerstone of this strategy was a disciplined M&A campaign. Magna5 completed and successfully integrated nine acquisitions of smaller, regional managed service providers (MSPs). This roll-up strategy allowed the company to rapidly gain scale, talent, and new geographic reach. This expansion was complemented by a deep operational overhaul, guided by NewSpring’s value creation team. Key initiatives included the implementation of a unified technology stack across the organization, the development of an institutional-grade sales infrastructure, and the standardization of operating processes and financial reporting.

"Magna5 reflects NewSpring Holdings' thesis-driven, systematic approach to building platforms of scale in fragmented markets," said NewSpring General Partner Jim Ashton. "By intentionally pairing Magna5 with proven technology services industry leader Bob Farina, and combining that expertise with a disciplined acquisition and integration strategy, we built a fully-integrated platform capable of solving increasingly complex IT and cybersecurity challenges."

This strategic approach yielded impressive results beyond revenue. The company’s employee base swelled nearly sixfold to 265 professionals, and it successfully penetrated high-growth, highly regulated industries including financial services, healthcare, and education. It also developed capabilities to serve clients needing to comply with the Cybersecurity Maturity Model Certification (CMMC), a critical requirement for businesses in the defense industrial base.

Consolidation Heats Up in Managed IT Services

The Magna5 transaction is a significant marker in the broader trend of consolidation sweeping the managed IT and cybersecurity services industry. As businesses of all sizes face an onslaught of sophisticated cyber threats and mounting regulatory pressures, the demand for comprehensive, reliable IT partners has skyrocketed.

This environment has created a fertile ground for M&A activity. Smaller, localized MSPs often struggle to provide the 24/7 support, advanced cybersecurity tools, and deep compliance expertise that mid-market and enterprise clients now require. As a result, private equity firms and larger strategic acquirers are actively rolling up these smaller providers to create national platforms like Magna5 that can deliver a consistent, high-quality suite of services at scale.

Magna5’s journey from a regional provider to a national leader through nine strategic acquisitions perfectly illustrates this market dynamic. The company now offers a full spectrum of services, from managed IT and cloud hosting to advanced cybersecurity and compliance consulting, making it a one-stop shop for businesses navigating an increasingly complex technology landscape. The acquisition by AEA Investors suggests this trend is not only continuing but accelerating, with well-capitalized platforms poised to capture even greater market share.

A New Chapter with AEA Investors

With the backing of AEA Investors, Magna5 is poised to enter its next phase of growth. Founded in 1968 by the Rockefeller, Mellon, and Harriman family interests, AEA has a long track record of partnering with management teams to foster long-term value. The investment was made by AEA's Small Business Private Equity (SBPE) team, which focuses on providing the first institutional capital to help companies accelerate growth.

This new partnership will provide Magna5 with significant resources to continue its expansion, both organically and through further strategic acquisitions. AEA’s focus on tech-enabled business services and its history of supporting buy-and-build strategies align perfectly with the playbook that has already proven so successful for Magna5. The firm's backing reinforces Magna5’s position as a leading consolidator in the managed services space.

Magna5 CEO Bob Farina expressed gratitude for the foundational support provided by NewSpring and optimism for the future. "NewSpring invested in Magna5 during a key inflection point in our company's growth story. Their value creation support and M&A expertise allowed our leadership team to stay focused on providing unparalleled service to our customers, while putting the right structure and resources in place to support our long-term direction," Farina stated. "We're grateful for NewSpring's partnership and look forward to working alongside the AEA team to continue the momentum."

Canaccord Genuity served as the exclusive financial advisor to Magna5 and NewSpring in the transaction, with Blank Rome LLP providing legal counsel and BDO offering accounting support. Now armed with fresh capital and the strategic support of AEA, Magna5 is well-equipped to build on its success and further solidify its leadership position in the national IT services landscape.