Large local human resources management firm ProService Hawaii has acquired a smaller competitor, Makai HR.

Financial terms of the acquisition were not disclosed, but the integration of the two Honolulu- based companies will add 25 employees to ProService’s existing staff of 370 and expand the number of Hawaii businesses served by ProService with outsourced human resources services to about 2,700 from 2,500.

The acquisition follows a deal announced last week in which California-based private equity firm Silver Lake acquired partial ownership in ProService, replacing another investor to help the company innovate and grow.

Terms of the investment were not disclosed. The prior equity investor, California-based FFL Partners, acquired a majority ownership stake in ProService in 2017 and helped the company grow over the past six years.

ProService was founded on Hawaii island in 1994, and in 2005 was acquired by Ben Godsey and partners.

The company handles a variety of services for small businesses including payroll, scheduling, health benefits management, workers’ compensation, 401(k) plans and HR compliance in what is known as the professional employer organization industry.

Makai HR was established in 2018 by Dustin Sellers, who partnered with Godsey to acquire ProService in 2005.

Godsey, ProService president and CEO, said the company will absorb Makai HR’s staff and executive team, who will continue to serve their clients.

“It’s a great addition for us,” he said.

Past acquisitions by ProService include Hawaii Human Resources Inc., a subsidiary of The Hawaii Group, in 2016.

The company also has expanded into mainland markets by establishing Obsidian HR in Colorado in 2019, investing in Minneapolis-based ProCare in 2021 and investing in Las Vegas-­based AdvanStaff HR in 2022.