After failing to merge with Sirius earlier this year, Sydney-based memory manufacturer Hypertec has signed a letter of intent which will see it being acquired by the European PC memory manufacturer, Memory Card Technology.
The move could be seen by many as just another local company falling to overseas interests. However, there is much more to it according to Hypertec's managing director, Colin Lillywhite.
"This is not just about survival or reacting to external pressures," Lillywhite said. "It is not a sugar daddy deal. Hypertec and MCT have both been trading very profitably. We are positioning the groups to where we think they need to be in the future.
"Hypertec has been looking for partners for quite some time to help grow the business in terms of economies of scale and geographical reach. We have made no secret of that."
Lillywhite said there will be several major benefits for Hypertec's resellers to emerge from this deal which values the company at around $A12.3 million, according to a statement MCT made to the Copenhagen stock exchange, where it is publicly listed.
In addition to the improved cost effectiveness of solutions that will come over time, resellers will also have the added assurance that comes with a secure supplier.
This is especially important in times when demand for memory is outstripping supply as it is now, according to Lillywhite.
"Security of supply is always a good thing in this business and it is important for our resellers to know that we have secured our future for the medium to long term," Lillywhite said. "There is absolutely no doubt that we will also be improving our cost position and we will be much faster to market with new products."
Lillywhite said the deal with MCT was slightly different from a lot of recent acquisitions of Australian companies by overseas interests, because Hypertec will make up nearly one third of the "merged" entity.
"The Hypertec name will remain," he said. "This is not a case where a company just buys itself a market position. The difference here is that we will retain all manufacturing operations and we will become the hub of the company's whole Asian expansion strategies.
"The number of staff we employ in Australia and the level of exports are both going to increase," he said.