Kelly Services last week announced it will buy US-based Motion Recruitment Partners (MRP) from private investment firm Littlejohn & Co. The acquisition will be the largest in Kelly’s history and includes the global Sevenstep RPO brand.  

“I’ve been pretty clear since becoming CEO that our growth strategy is (not only) growing organically…but also adding to the portfolio with inorganic or M&A activity,” said Kelly President and Chief Executive Officer Peter Quigley in an interview with Staffing Industry Analysts. “This acquisition is consistent with this strategy.”  

Under terms of the deal, Kelly will acquire MRP for $425 million in cash to be paid at close, with additional earnout potential of up to $60 million based on certain performance criteria.  

The transaction is expected to close in the second quarter of 2024, subject to receipt of required regulatory approvals and other customary closing conditions. 

Kelly expects to fund the acquisition through debt and available capital, including the rapid redeployment of more than $100 million from the sale of Kelly’s European staffing operations in January 2024.

The purchase of MRP will include its Motion Recruitment, TG Federal, Motion Telco, and Sevenstep businesses. 

Post-transaction, MRP will deliver services through its existing operating companies and brands with the goal of expanding Kelly’s capabilities and increasing market share across several key areas.  

“We’re very excited about having Sevenstep as part of this deal,” said Quigley. “Our RPO business has grown significantly in the last three to four years, notwithstanding economic headwinds recently. We’re very bullish on the RPO business generally and think the addition of Sevenstep is really exciting.” 

He added that Sevenstep has “a longstanding history in the RPO business and they have developed a best-in-class platform for delivering RPO services … Their tech stack is very exciting to us. We think we can bring that to bear for Kelly’s RPO customers.”  

At the same time, Motion Recruitment’s technology staffing and consulting business is set to expand Kelly SET’s delivery platform and establish the business as a top 10 provider of tech talent solutions in the US, according to the Kelly release. 

Meanwhile, Motion Telco will add a complementary client portfolio and set of delivery capabilities to Kelly’s existing telecommunications specialty, while TG Federal will bring a dedicated new platform in government technology subcontracting with strong partnerships, the company said. 

“This acquisition will reposition the combined Kelly-Motion as a leading provider of technology talent from Silicon Valley to New York,” said Quigley. “Kelly has been a player in the technology space, but this creates a step-change in the capabilities that we will be able to provide to our customers.”   

Kelly said the acquisition of MRP will enhance the revenue growth potential of the company and accelerate EBITDA margin expansion. It will build upon the significant EBITDA margin expansion Kelly has delivered through actions implemented in 2023 and the sale of the company’s European staffing operations in January 2024. 

"We are proud to have partnered with MRP’s strong leadership team during an important period of growth and evolution,” Drew Greenwood, managing director, Littlejohn, said in a press release. “During our ownership period, MRP executed on a number of organic and inorganic initiatives that positioned it as a premier talent solutions provider with particular strength and depth in the technology market. We wish the company continued success as part of Kelly moving forward.” 

The agreement with MRP follows eight acquisitions since 2017 as part of the company’s strategy to pursue inorganic investments in higher-margin, higher-growth specialties. Kelly will provide further details on the transaction during its upcoming first-quarter earnings conference call on May 9, 2024. 

Kelly Services has previously ranked as the 12th-largest staffing firm in the world, however, its business portfolio has changed radically over the past 12 months. The group recently reported fourth-quarter revenue fell 1.3% in constant currency amid an uncertain economy.