Belmont-based industrial services company Paladio Group Ltd has reached a conditional agreement to purchase engineering design and drafting services provider Matrix Engineers Pty Ltd for $3.2 million in cash and scrip.
The full text of a company announcement is pasted below
The Directors of Paladio Group Limited are pleased to announce that a conditional agreement has been reached to purchase all of the business assets of Matrix Engineers Pty Ltd (Matrix).
Matrix is a Perth based engineering design and drafting services provider specialising in civil and structural engineering both in Australia and overseas.
Matrix was founded in 2004 by Mr. Jeremy Green and Mr. Paul Kreppold to provide design, documentation and engineering services to the mining and petrochemical industry sectors.
Both Messrs Green and Kreppold were formerly long-serving principal discipline engineers at Minproc.
Matrix currently employs 35 engineering and drafting staff in their Perth office and also at clients' premises. Their major current contract is the provision of engineering services for Inco's Goro nickel project.
The business will continue to trade as Matrix Engineers and is expected to contribute more than $8 million in revenue annually with excellent prospects for further growth.
Paladio's Managing Director, Mr. Dick Wright said, "Our engineering services division has performed strongly since its inception with high demand in the resources sector likely to continue in the foreseeable future. The opportunity to acquire Matrix is strongly complementary to our existing businesses as it further expands our engineering design and drafting services capabilities, as well as our customer base".
The two founders, Messrs Green and Kreppold, will enter into two year contracts of employment and will continue in their roles as senior management members of Paladio's engineering services division. Mr. Green said, "We are very optimistic about the growth potential offered by current market conditions which will now be augmented by joining the Paladio group of companies."
The consideration payable by Paladio for Matrix is $3.2 million over two years via a mix of cash (70%) and shares (30%). The equity component will be at a deemed issue price of $0.75 per share. The cash component will be funded from Paladio's existing cash reserves.
Settlement of this acquisition is subject to due diligence deliberations and settlement is anticipated to be completed by the end of this month.
