Adecco has sold a majority stake in its Beeline vendor management system division for $100 million in cash plus a $30 million note to Chicago-based private equity firm GTCR, which also holds a majority stake in IQNavigator. Plans call for merging the operations of Beeline and IQNavigator, with Adecco continuing to hold a minority interest in the combined firm.

The deal closed Monday. Under the terms of the definitive merger agreement, GTCR purchased the vendor management solution software and related assets of Beeline from Adecco Group; financial terms were not disclosed.

“This merger is an exciting step for our two companies as we continue to lead the development of the VMS industry and deliver the next generation of contingent workforce technology,” said Doug Leeby who has been appointed CEO of the combined company. “We now have over $40 billion of spend under management for customers in over 100 countries. These customers will continue to operate on their existing Beeline and IQNavigator platforms, but will immediately get access to additional complementary services and expertise, further enhancing the solutions that they enjoy today and in the future.”

Leeby previously was CEO of Beeline. Joe Juliano, former CEO of IQNavigator, is a member of the board of the newly combined company. Other senior appointments announced share roles between the two firms:

Beeline employees:

• Autumn Vaupel, COO
• Ron Litton, sales
• Manuel Roger, global markets

IQNavigator employees:

• Brian Hoffmeyer, global marketing
• Sherri Hammons, CTO
• Barry Capoot, CFO

The combined company will have more than 500 employees in total and continue to operate from offices in Jacksonville, Fla., and Denver, Colo. The companies also have offices in the UK, Singapore and the Philippines.

“This is a very exciting announcement for the market as it brings together two giants of the VMS global landscape,” said Elizabeth Rennie, global workforce solutions research director for Staffing Industry Analysts. “IQNavigator and Beeline combined represent 34% of the total MSP market (by worker headcount), challenging Fieldglass’ global position.”

Click on image of VMS worker volumes to enlarge.

For IQN customers, the company has stated it will continue to execute on its product roadmap, and Beeline’s current roadmap is published here. The Beeline roadmap is prior to the merger.

Spinning Beeline off of Adecco means that the world’s largest VMS providers now operate independently of staffing firms.

VMS solutions are a key part of managing the total workforce for today’s large corporations,” Adecco Group CEO Alain Dehaze said. “This merger is positive for all stakeholders: clients will receive even stronger solutions, support and service; colleagues will benefit from being part of an enlarged and independent VMS company focused on leading in contingent workforce technology; and the Adecco Group and our shareholders benefit from crystallizing value from our previous investments in this business.”

The combined companies say they will leverage the complementary technical strengths of both Beeline and IQNavigator although how this plays out remains to be seen.

“We are thrilled that these two market leaders are joining forces to create the clear number one independent VMS provider for extended workforce management solutions,” Juliano said. “This is a strong cultural fit, with IQNavigator and Beeline sharing common values of customer focus, quality and performance.”

Staffing Industry Analysts published its VMS Market Developments Summary today. Members can access the report by clicking here.