Decmil buys telco business for $14m-plus

Decmil Group has continued to diversify its business from the struggling resources sector by acquiring Osborne Park-based telecommunications solutions provider SC Services.

Decmil will pay $14 million up-front with a further payment dependent on SC's earnings in the current financial year.

The sale was brokered by Tomkins Turner Corporate Advisory, which was engaged by SC founder John Ryall to find a new owner for the business.

SC offers a suite of design, installation and commissioning services to telecommunications network owners, manufacturers and NBN service providers.

The acquisition was made on a cash and debt-free basis.

“The acquisition provides Decmil with direct exposure to the telecommunications infrastructure services market in Australia, which continues to experience growth due to investment in wireless networks and the ramp-up of the NBN program,” the company said in a statement.

SC Services was born in Perth in 2001 and has since opened a second office in NSW.

It employs about 100 nationally, and generated about $26 million in revenue in the 2015 financial year, along with earnings before interest, tax, depreciation and amortisation of about $3.5 million.

Under the terms of the deal, Mr Ryall will become general manager of the business which will continue to trade under the same name.

Decmil managing director Scott Criddle said the acquisition would give Decmil scale and a national presence in the growing telecommunication sector.

“This is an important step forward in our strategy to build a broader and robust business that, in addition to our historical strength in the natural resources sector, has reach and capability across Australia in a variety of public and private sector infrastructure,” he said.

The SC deal is the fifth business sale brokered by Tomkins Turner in the past 18 months.

It follows the sale of locally-owned wine and pharmaceutical labelling business Supa Stik to a major international buyer on 31 October.

Tomkins Turner closed 3 deals FY15, being G&G Mining Services, Scope Systems and Appian Group.