CSG scores $31m Canon deal
- 12 May, 2010 13:27
- Comments 1
Darwin-based integrator, CSG, has partnered with Canon Australia in a bid to ramp up its print services business.
Under the $31 million arrangement, CSG will be a dealer for 10,500 Canon Multi-Function Devices (MFD) in Sydney, Melbourne, Canberra, Adelaide and Perth.
CSG will also have sub-contractor rights over an existing portfolio of around 10,500 MFDs.
The existing customer contracts to be sub-contracted to CSG operate under multi-year contracts. CSG will acquire other existing infrastructure to enable customers to be serviced immediately.
The integrator has also outlined plans to raise $40 million in equity through a fully underwritten institutional placement.
The first $10 million will be used to fund the first instalment of the Canon payment ($6 million), and to provide working capital for the Print Services business.
$20 million will be used to fund the acquisition of Leasing Solutions, $2 million to cover the acquisition of Aaromba Technologies, and $8 million to provide additional working capital, increased financial flexibility and to pay for the costs of the placement itself.
In a statement to the ASX, CSG claimed the partnership would create significant value for shareholders. The transaction is expected to be immediately earnings accretive. Earnings per share growth of about 15 per cent is expected in FY2011.
Aaromba Technologies, the most recent CSG acquisition announced today, is a Sydney-based CRM and IT service desk business.
CSG said the business could provide its Enterprise Services division with additional growth potential in Sydney and Melbourne.
Leasing Solutions was acquired by CSG in 2009 as part of the acquisition of Konica Minolta Business Services. It capped off a busy 12 months for the integrator, following from the acquisition of Oracle specialist, Delexian, in July, and Commander’s managed services in 2008.
Nominations for the 2012 ARN IT Industry Awards open on Tuesday, June 12.
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Comments
Anon
Well this is turning into mud - rumour has it the relationship is so fractured they are about to end it. The deal never took off, was poorly thought through, and was impossible to execute. Several high calibre managers who challenged the decision, within Canon, knowing this would happen were also terminated.
Well done Corder and Manson! You will have left a deep scar in Canon that it will take many many years to recover from.
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