Menu
Inabox acquires Neural to build Cloud portfolio

Inabox acquires Neural to build Cloud portfolio

Purchase adds base for Cloud play ahead of future acquisitive growth

The Inabox Group (ASX:IAB) will purchase the business and assets of Brisbane-based Neural Networks Data Services for $A350,000 from its cash reserves in a bid to build its Cloud play.

Neural is a provider of wholesale Cloud and VoIP products. Its communications portfolio spans voice and messaging, while its data and servers services include co-location, Cloud and connectivity.

The agreement will see Inabox attain more than 100 wholesale customers which include ICT and managed services providers, Neural’s proprietary customer portal, and other back-of-house operations.

According to Inabox managing director, Damian Kay, Neural was pursued to meet demand for Cloud services among small to medium-sized enterprises (SMEs) which are its customers’ end users.

“The acquisition of the Neural business sets us up well to take part in the growth of these revenue streams… [and] complements our acquisition of iVox in 2013.”

"Eighty (80) per cent of our revenues are from SME end users. That market in the Cloud space is growing very fast. For our services providers to be sustainable with an over-the-top Cloud play is vital."

The purchase is scheduled for completion in early July, at which point Neural founder, David Swinton, will join Inabox as general manager for Cloud; the role will see him continue to manage the Neural business which will retail its brand under the Inabox umbrella.

Read more: 2014 ARN ICT Industry Awards: Cloud and community awards a crowd favourite

"This is a strategic acquisition," Kay said. "It adds revenue, profit, earnings per share (EPS), but that's marginal compared to our business."

"What it really adds to the business is knowledge and technical expertise so we can take Neural's Cloud products through the rest of our channels."

The agreement will see Inabox attain more than 100 wholesale customers (ICT and managed services providers), Neural’s proprietary customer portal, and other back-of-house operations.

Read more: Strong adoption puts Cloud in focus for businesses: Mimecast

Inabox will also employ three or four of Neural six staff, with the remaining to be made redundant.

According to a statement, Inabox expects the deal to be earnings per share (EPS) accretive during fiscal 2015 (before transaction costs and amortisation of acquired tangibles) irrespective of whether the purchase price is paid wholly in cash or partially in equity.

Moving forward, Kay said Inabox will continue to chase acquisitive growth targets. He said the Group is in talks with a number of wholesale services providers and small Cloud companies; these will be smaller players which Inabox will effectively take out of the market if buys occur.

In May, Inabox said it expects to finish the second half of fiscal 2014 with no less than $A850,000 in net profit before tax.

Read More:

Follow Us

Join the ARN newsletter!

Error: Please check your email address.

Tags MSPwholesaleTelcoinaboxacquisitionInabox GroupIABservicesEPSDavid SwintoncashCloudfinancialsvoipASXtecloTelecommunicationsNeural Networks Data Servicesmanaging directorDamian Kay

Upcoming

Slideshows

IN PICTURES: VMware's VMworld 2015 day 1 (+13 photos)

IN PICTURES: VMware's VMworld 2015 day 1 (+13 photos)

VMware has kicked off VMworld 2015 in San Francisco and the first day saw keynotes from its president and CEO, Carl Eschenbach; executive vice-president and general manager, Bill Fathers; and executive vice-president and general manager of SDDC, Raghu Raghuram; amongst others. VMware also made Cloud-related announcements and demonstrated its latest technology.

IN PICTURES: VMware's VMworld 2015 day 1 (+13 photos)
IN PICTURES: 2015 Microsoft Australia Partner Awards (+21 photos)

IN PICTURES: 2015 Microsoft Australia Partner Awards (+21 photos)

The achievements of Microsoft’s Australian partners over the past year have been recognised through a number of prestigious awards announced at the 2015 Microsoft Australia Partner Conference (APC) on the Gold Coast. The Microsoft Australia Partner Awards showcased partners delivering innovative solutions and services to customers, with many embracing Microsoft’s Cloud solutions. Awards were presented in 17 categories. The winners were chosen from more than 170 nominations. With more than 11,000 partners in Australia it was a competitive field. Photos by ARN Editor, ALLAN SWANN.

IN PICTURES: 2015 Microsoft Australia Partner Awards (+21 photos)

iasset.com is a channel management ecosystem that automates all major aspects of the entire sales, marketing and service process, including data tracking, integrated learning, knowledge management and product lifecycle management.

Show Comments