Amcom Telecommunications has proposed to acquire voice and communications technology provider, IP Systems for up to $20.5 million.
Perth-based Amcom said the acquisition will expand its product range into enterprise voice solutions.
"This gives us the potential to significantly increase Amcom's share of our customers' spend on telecommunications services," chief executive Clive Stein said.
"IPS has 10 years' experience in deploying reliable market leading voice and communications technology, and its products are ideally suited to Amcom's existing customer base.
"We are very pleased that as a result of this acquisition we will be able to provide our existing customers with a 'best of breed' voice and communication solution that enhances our already strong customer relationships."
He added that private company IP Systems will add about $12 million revenue to Amcom, and the transaction will be EPS accretive for shareholders in the first full year of ownership.
Initial consideration for the acquisition will be $6.5 million, consisting of $5.3 million in cash and 4.1 million Amcom shares at 30 cents each.
Amcom will issue more shares, with a minimum floor of $3 million and a maximum cap of $14 million, should IP Systems meet agreed profitability levels.
Amcom said the transaction has been priced upon a normalised earnings before interest and tax multiple of 5x subject to the consideration cap and floor.
Shareholders will need to approve the transaction, and a meeting has been scheduled for April.
