West Des Moines-based business services company Aureon has signed an agreement to sell its human resources outsourcing business, Aureon HR, to Oasis Outsourcing, effective immediately. 

Based in West Palm Beach, Fla., Oasis Outsourcing is the largest privately owned professional employer organization (PEO) in the United States. With the acquisition, Oasis will now serve more than 8,000 clients and 270,000 worksite employees nationwide. Terms of the deal were not disclosed. PEOs specialize in providing comprehensive HR solutions for small and mid-size businesses. 

“We are delighted to join forces with Aureon HR, an industry leader that has an outstanding track record in the Midwest and in all markets it serves,” said Mark Perlberg, president and CEO of Oasis Outsourcing. 

In a phone interview with the Business Record, Perlberg said that his company plans to retain all of Aureon HR’s employees — approximately 200 — at its current West Des Moines and Denver, Colo. offices. Melissa Ness, previously chief operating officer of Aureon HR, will lead the division as its president. She succeeds Joel Duncan, who is retiring as part of the company’s succession plan. 

Perlberg, who has known Duncan for about the past 10 years through their involvement in the PEO industry, said he was excited when he heard that the operation was for sale.  

“It’s a very good complementary set of products and services, and It’s been a very successful company,” Perlberg said. “”Our focus is to help that continued growth in whatever way we can.” 

Over the next several months, Aureon HR will be rebranded under the Oasis Outsourcing name, he said. 

“Our plan is to absolutely operate this with existing employees as one of our more significant locations,” Perlberg said. “Our growth over time has been building a national footprint, and the Midwest has been a part of that. … We do like the Midwest in general and this is a very significant step forward in that regard.”

The Aureon HR acquisition is the sixth by Oasis since it joined forces with Stone Point Capital, a private equity firm based in Greenwich, Conn. 

Ron Keller, CEO of Aureon, said the HR outsourcing business has been a particularly hot segment for merger and acquisition activity, in a climate in which companies have been sitting on considerable cash to invest. Aureon had been examining both purchase and sale opportunities with an investment banker, he said. 

“It’s kind of a bittersweet transaction for us, because the business exceeded our expectations,” he said. “But based on all those favorable market conditions, we had this opportunity where we felt that we had the fiduciary responsibility to our shareholders.” 

The sale will be a win for clients, he said. 

“Moving forward, Aureon HR clients will receive the benefits that an even larger industry leader can provide, while continuing to receive outstanding performance and support from the local Aureon HR team,” Keller said. 

Aureon, formerly known as the INS Family of Companies, rebranded in 2016. It had acquired Merit Resources in 2013 and subsequently bought Portico Staffing in Des Moines and then Peliton, a Denver-based PEO. Keller said that Aureon HR’s top line and bottom line growth have been much more than expected, which made it a much larger part of the overall organization than anticipated. 

Following the sale, Aureon has about 600 employees in Greater Des Moines in business support services that include technology, customer support and consulting divisions. 

Keller said that Aureon’s board is still considering how to use the proceeds from the sale. The company is owned by 127 independent rural telephone companies, and the funds may enable Aureon to update and expand its core fiber networks more quickly than it might otherwise have done, he said.