When Volaris acquires a business, we feel strongly that its leaders and employees are best positioned to continue operating autonomously, as they are used to doing. However, in some cases businesses joining us make an informed decision to be merged into an existing business within our group.

Several businesses that have sold to Volaris have come to the conclusion that a tuck-in acquisition is the best path for them—where a company is strategically merged into a complementary business within the same vertical market. Companies may consider being part of a tuck-in if they already have a great product that they can see aligning well with a larger company. They are also typically ready to give their team new experiences and take their skills to the next level.

Advantages of tuck-ins are that they can boost income-generating and growth opportunities for both parties, who may have previously acted as competitors in the same market. By joining forces, competitors can benefit from sharing information and business processes with each other, ultimately adding value for customers. This type of deal can be low-risk for both parties, since the two companies are often already aware of each other’s capabilities. Both can expand reach and increase their credibility in markets they serve.

Since Volaris was founded, we have completed dozens of tuck-in acquisitions. Our deep expertise with structuring acquisitions and integrating employees has led to several tuck-in acquisitions for companies who decided this type of arrangement would work for them. One example is Rental Result, which was tucked into Wynne Systems in 2015.

From Survival Mode to Success

When UK-based Rental Result was presented with the opportunity to be acquired in 2015, the company was in a tough financial position. The rental software provider had invested heavily into oil services, but suffered when the price of oil dipped below $50 a barrel because their customer base was not adequately diversified.

One option for Rental Result was to pursue a buyer. Fortune turned out to be in their favor when Volaris was able to give the company a home. The company was tucked-in to U.S.-based Wynne Systems, a construction equipment rental software provider with synergies in the same vertical market. Since the U.S. market was much larger than the UK market, this presented room for growth.

The team at Wynne recognized that Rental Result’s staff were especially strong in customer care and professional services, which are important for a healthy revenue stream. With six years behind them since the tuck-in acquisition, several employees from Rental Result have taken new career opportunities and leadership roles. The combined company also found synergies in the product development side. In addition, Rental Result’s product helped broaden the customer base for Wynne, and Wynne was able to help minimize Rental Result’s exposure to the oil market and add more customers in the medical sector.

Today, Rental Result’s product is still sold by Volaris Group, and their team has been able to thrive after a successful tuck-in acquisition experience. Adding their complementary strengths to Wynne Systems has helped build one of the strongest business units within Volaris Group.