24/07/2007 - 22:00

Integrated's $190m growth spurt

24/07/2007 - 22:00

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West Perth-based labour hire firm Integrated Group Ltd is continuing with its plan for an interstate and overseas expansion, after undergoing a $190 million merger by scheme of arrangement with Melbourne-based Programmed Management Services last month.

Integrated's $190m growth spurt

West Perth-based labour hire firm Integrated Group Ltd is continuing with its plan for an interstate and overseas expansion, after undergoing a $190 million merger by scheme of arrangement with Melbourne-based Programmed Management Services last month.

Over the next 12 months, the company will expand both its work-force business, in New Zealand, and its marine services business, in the UK.

This follows the acquisition of Kwinana-based Sound Personnel and Newcastle-based High Point Personnel earlier this year.

Integrated chief executive officer Chris Sutherland said the merger had provided the opportunity to move faster, with less risk.

“We see opportunities for us to grow both our marine business and our workforce business outside Australia, and we think that being part of a broader group will allow us to do that,” Mr Sutherland said.

Integrated will adopt a number of strategies, including co-locating with PMS offices, establishing new offices and purchasing existing businesses.

“If we can find the right bolt-on acquisition to expand ourselves, either technically or geographically, then we will,” Mr Sutherland said.

He said there was a strong market Australia-wide in the labour hire market, with Integrated screening between six and 12 potential acquisitions at any one time.

“You’ve just got to make sure that one, it fits your strategy, and two, you can do it for the price that matches the risk of buying these small businesses, where you’re highly dependent upon the existing employees remaining with the business and being able to maintain existing client relationships,” Mr Sutherland said. 

Integrated plans to grow across its three service areas – recruitment and labour hire, marine services and technical maintenance.

Mr Sutherland said the opportunities to grow the technical maintenance business, in the energy and resources sector, were particularly attractive.

“That’s a market that neither Integrated nor PMS does much in at the moment, but it’s certainly a space we’re looking at entering,” he said.

Integrated is already working with West Perth-based Apache Energy Ltd – its first oil and gas client – through its labour hire business, and provides maintenance and labour hire services to BHP.

The company will continue to serve as the recruitment and labour hire brand for PMS and will retain its own business functions, including human resources, marketing and occupational safety.

“What’s disappeared from here is effectively what was required to be a listed entity,” Mr Sutherland said.

As part of the merger, Integrated has created a smaller corporate office, retaining the IT and payroll functions for PMS in Perth, and linking some higher-level functions, including business development, with the parent company.

Mr Sutherland said the merger had given Integrated an economy of scale and improved efficiencies, through combining its back office functions.

“We certainly think that use of IT and technology in our space is going to continue to fundamentally change the business over the next five to 10 years, and you need scale to make those sorts of investments,” he said.

 

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