IT Services provider ASG Group Limited today announced the acquisition of Sydney-based Vindaloo Systems, a leading Oracle solutions and managed services group.
IT Services provider ASG Group Limited today announced the acquisition of Sydney-based Vindaloo Systems, a leading Oracle solutions and managed services group.
The acquisition delivers to ASG a significant boost to its delivery capability and positions the Company for further growth in the Sydney market.
It is also part of ASG's strategy of building capability and national service reach through organic growth and earnings per share accretive acquisitions.
Vindaloo Systems is a top-end Oracle consulting firm that will bring to ASG a premium customer base with strong annuity revenue streams, outstanding technical and consulting capability and a sizeable and growing market share.
Vindaloo currently employs approximately 45 staff including leading Oracle Consultants.
ASG's purchase consideration is based on a 4.75 times EBIT multiple and will be in the
form of cash and ASG shares. The acquisition will be immediately earnings per share
accretive.
ASG also announced today a $4 million capital raising. The raising was underwritten by
Paradice Investment Management. Proceeds from the issue will be used to fund the
acquisition and to provide working capital for the further growth of ASG's combined
businesses.
ASG Chief Executive Officer Geoff Lewis said the Vindaloo acquisition represents an
important step forward for the Company in its ambition to build a leadership position in the
Sydney market.
"We have admired the Vindaloo business for a long time, particularly its technical and
service capability," said Mr Lewis.
"Vindaloo's premium client base and its footprint in the Sydney market represent a great
opportunity for ASG to build our presence in this important market."
Vindaloo was founded in 2000 and had built a strong market position in delivering a range
of exclusive, cutting-edge solutions and services.
These include Oracle consulting, managed services, specialised methodologies and
complementary solutions to enhance Oracle solutions, applications development and
systems integration solutions.
The company has a reputation for being a specialist in supply chain management and has
built a strong presence in the automotive and retail sectors.
Mr Lewis said the new business would operate under ASG's Northern region division,
which recently announced major new contracts with Qantas and Ericsson.
"ASG has achieved consistent and strong revenue and earnings growth over recent financial
years and the Vindaloo acquisition will accelerate that growth. Vindaloo also has a number
of significant long term customer relationships which will complement ASG's cumulative
revenue business model" he said.
"Importantly, the acquisition is a great strategic fit for ASG, offering a blue-chip client
base, opportunities to leverage other ASG services as well as increased earnings."
