Contractor Viento Group plans to broaden its range of services with the purchase of Hazelmere-based switchroom manufacturer HVLV in a prospective deal worth up to $21 million.
Viento told the market on Thursday it had agreed to purchase all of HVLV's issued securities based on an enterprise value of $21.3 million, subject to shareholder approval.
The value of the transaction is clouded by a number of conditions on the deal.
Viento's consideration includes a $3 million cash payment, deferred until March 2015.
It will also issue 23.6 million convertible notes over three tranches, 7.9 million ordinary fully paid shares and the assumption of HVLV's core bank facilities.
HVLV achieved revenue of $44 million in the 2013 financial year.
Its revenue contribution to Viento for the six months to 30 June 2014 is expected to be in excess of $35 million.
"My vision is to build HVLV into a company which offers an increased level of construction and electrical solutions to its existing customer base."
He said he saw a number of opportunities for HVLV to secure additional work and extend its capabilities with the support of Viento.