Veris soars on Telstra deal

31/01/2022 - 13:30

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Osborne Park-based Veris has struck a $30 million deal with Telstra, sending the surveying company's shares up by more than 25 per cent.

Veris soars on Telstra deal
Aqura Technologies chief executive Travis Young.

Osborne Park-based Veris has struck a $30 million deal with Telstra, sending the surveying company's shares up by more than 25 per cent.

The telco giant's consulting arm, Telstra Purple, this morning announced plans to buy Veris subsidiary Aqura Technologies and Brisbane-based Alliance Automation, marking the firm's 10th and 11th acquisition since it was established by Telstra Corporation in late 2019.

Telstra Purple said the latest move was intended to accelerate its IoT capabilities, growth ambitions, cloud, and security.

It will pay $30 million in cash for all the shares in Aqura Technologies, as announced by Veris this morning. A cost for the Alliance deal was not disclosed.

Veris' shares were trading as much as 7.7 cents today, up 30 per cent since last Tuesday.

The company said the deal was a compelling outcome for all stakeholders and would allow Veris to grow its digital and spatial offering.

That’s despite earlier plans to list Aqura on the ASX following strong growth and significant contract wins, including with iron ore majors Fortescue and Roy Hill.

“Whilst Aqura has been growing strongly under Veris’ ownership, the board is of the view that the timing is right to sell the business to provide the Aqura team the opportunity to accelerate this growth further by accessing Telstra’s existing sales and customer channels…” Veris chairman Karl Paganin said.

“Following the sale… Veris will be in a position to retire all bank debt and be well capitalised with a strong balance sheet and a significant net cash position.

“This balance sheet strength will place Veris in a strong position to pursue its growth ambitions for Veris Australia and underpin the continued expansion of Veris Australia’s digital and spatial data-as-a-service strategy.”

Aqura, which was established in 2017 when Veris renamed its communications division, has more than 90 staff across offices in Perth, Brisbane, Adelaide, and Melbourne. It also has a fly-in, fly-out workforce that services all parts of Australia.

“Our team are very excited about the opportunities that are ahead,” Aqura chief executive Travis Young said.

“Our specialist capabilities, coupled with the highly complementary service offerings of the broader Telstra Purple family will deliver more powerful and compelling solutions.

“We can now more rapidly accelerate our growth to meet the significant demand of organisations who are looking to leverage next-generation connectivity as part of their broader digitisation strategies.”

The sale does not need approval from Veris’ shareholders and is expected to occur on February 28.

Azure Capital is acting as financial adviser to Veris and Steinepreis Paganin as legal adviser.

Telstra Purple expects the acquisition will allow the company to deliver industrial-grade wireless and fixed networks in remote and underground operations.

Meanwhile, the Alliance acquisition is intended to expand Telstra's potential for digital transformation services, industrial automation capabilities, digital twins, smart spaces, and operational technology cyber security.

Alliance has several offices around Australia, including one in the Perth CBD, and a team of more than 250 engineers and consultants.

Telstra Purple boss Christopher Smith said both Alliance and Aqura had demonstrated consistent growth and strong customer and vendor relationships.

“We were impressed by their people, expertise and capabilities and believe they will be very valuable additions to the Telstra Purple team,” he said.

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