Hardware vendor NetComm has acquired the New Zealand-based broadband provider, Dynalink, in a Heads of Agreement deal worth more than $1 million.
NetComm will acquire the net tangible assets for Dynalink whose owners will earn additional payment based on the profitability of the company over the next 18 months.
"The deal went very smoothly," NetComm managing director, Dave Stewart, said. "It was as simple as picking up the phone and giving Dynalink a call."
Although several NZ resellers shipped NetComm products from Australia, the hardware vendor had no previous operations based across the Tasman.
"It was pretty obvious that if we take our product and plug into their network, it would be a win-win situation," Stewart said.
After probing the New Zealand market to gauge retailer and distributor awareness of Dynalink's presence, NetComm conceded that it would be beneficial for both companies to join forces instead of setting up a direct presence, he said.
"We have a larger range of products and they have a very strong presence in NZ as well as great relationships with customers," Stewart said.
Although the NetComm's portfolio of products will be sold through the Dynalink network, the NZ-based company will retain its company name and product brand. Ian Ferry will remain as managing director of Dynalink and there will be no immediate plans for staff changes.
"It is positive for everybody involved," Dynalink managing director, Ian Ferry, said. "We already have the infrastructure in NZ without adding any cost to the group."
NetComm expects the acquisition will increase the company's revenue by 25 per cent.