THE state’s business brokers are experiencing a surge in activity as business optimism about the year ahead creates an environment conducive to selling, particularly in the IT sector.
THE state’s business brokers are experiencing a surge in activity as business optimism about the year ahead creates an environment conducive to selling, particularly in the IT sector.
A recent review by West Perth-based Goodwin Mitchell O’Hehir & Associates found significant growth and interest in IT and communications businesses during the past year, while there was a decline in interest in financial planning and mortgage broking businesses.
Results of the firm’s annual business review have been mirrored by recent transactions in the IT and communications space, including iiNet’s $40 million acquisition of Netscape in March.
More recently, Perth-based IT services provider ASG Group this week entered the SAP market by acquiring West Perth-based Courtland Business Solutions for a 50-50 cash and scrip deal.
Courtland is an SAP software provider delivering services to the mining, oil and gas, engineering, construction and infrastructure sectors.
The move means ASG, which is historically a key supplier of Oracle information management software technology, with competing SAP business software.
However, ASG chief executive Geoff Lewis said the firm would keep its Oracle and SAP practices separate and roll-out whichever software set would best suit potential clients.
The total purchase price is based on a multiple of five times earnings before interest and tax and is subject to Courtland meeting certain performance benchmarks over time, which will ensure the acquisition remains earnings per share accretive for ASG.
Mr Lewis said the acquisition of SAP capability was a strategic move that would increase the company’s product offering and effectively double its market opportunity.
South West-based communications company Total Telephone has bought its way into WA’s metropolitan market with the acquisition of East Perth-based Communications Plus.
Total Telephone director Alistair McKenzie told WA Business News the communications company had a “good business model down south and we’re bringing that to Perth”.
Mr McKenzie said Total, which has been operating since 1988, would provide a metropolitan network of phone, data and fibre optic installation services that will complement the company’s existing regional base.
Meanwhile, Applecross-based engineering company Monadelphous Group has entered into a memorandum of understanding to acquire onshore pipeline constructor KT Pty Ltd.
The deal, which is expected to be finalised by the end of the 2009-10 financial year, will not exceed $30 million and will be based on three times average annualised earnings before interest and tax.
Monadelphous has agreed to buy 100 per cent of KT shares for a combination of cash and an issue of shares in Monadelphous.
