TSI in $8.6m purchase

Local tech company Transaction Solutions International has acquired a Sydney-based cloud management business in a deal worth $8.6 million.

Fremantle-based TSI has entered into an agreement to purchase Cloudten, with five cash payments over the next 12 months totalling $8.6 million.

The deal also includes variable components, to be paid in cash and scrip, based on Cloudten’s profits over the next three years.

Cloudten, which helps large enterprises and government to migrate and manage their cloud infrastructure, recorded revenue of $3.8 million and a $1.6 million profit in the 2018 financial year.

Founded in 2014, Cloudten employs about 20 people and has plans to expand to London and Singapore in 2019.

Cloudten has a consulting partnership with Amazon Web Services, which is the dominant infrastructure-as-a-service provider globally.

TSI owns Sydney-based cybersecurity company Decipher Works and has a 25 per cent stake in TSI India, which operates an e-transactions and payments business in India.

The company has also announced a $2 million capital raising to fund the acquisition.

TSI will issue 235 million shares at 0.85 cents each, representing a 20 per cent premium on the last closing price.

Red Leaf Securities is acting as lead manager to the placement.

Shares in TSI were up 14.3 per cent at 0.8 cents each at 12.30pm AEDT.