Armed with record revenues and larger than forecast net profits, QLD distributor Data#3 is hot on the acquisition trail.
The business it wants to purchase will fall into one of three types: PC dealerships, services companies or a smaller version of Data#3's own multi-faceted model, said managing director John Grant.
The hunt for a business that potentially will add more than $25 million to Data#3's current revenues is centered on Sydney because NSW has the most buoyant IT market, he said.
Grant said that acquisitions are a key component of Data#3's three year strategic plan, and that following some months of investigation he was hopeful the company would be able to acquire a compatible IT business within the next six months. "The types of businesses we've been speaking to could potentially add in excess of $25 million to our current yearly revenue".
In terms of purchase price, the least expensive option would be a PC dealership, Grant said. It would look for one that is well run, enjoys a low cost structure, is margin sensitive and commands customer loyalty.
"This is our buy-then-build option where we would enhance its service while maintaining its product and customer sides."
Higher on the price scale is a services business with sketchy product, sales and marketing focus but highly skilled technical staff and multiple technology partners.
The final option, a smaller version of itself to which Data#3 would add its own differentiates such as its SAP and Direct Magic offerings for SME customers, would command the highest initial price but would generate a larger market share in a shorter time.
Grant said Data#3's Help Desk business doubled projections to establish 45 new Help Desk sites nationally. Revenues from its services division rose 25 per cent to $11.5 million and on the SAP side, five new SME sites were secured in the past 12 months.