S Central, ComputerCorp and Synergy Plus to merge

S Central, ComputerCorp and Synergy Plus to merge

The three companies will combine to form a new listed IT integration powerhouse

S Central, ComputerCorp and Synergy Plus will combine as one listed IT integration powerhouse following a major merger agreement.

S Central has purchased a 30 per cent stake in ASX-listed ComputerCorp, making it one of the largest single shareholders in the business. The deal coincides with ComputerCorp’s acquisition of Synergy Plus from listed player, Hyro Limited, for $9.3 million.

S Central managing director, Peter Mavridis, said the merger was about establishing an integration player comprehensive enough to provide end-to-end solutions to customers.

“There’s been a gap in the market with the demise of Commander – other than Data#3, there really isn’t anyone playing in that mid-market space,” Mavridis told ARN. “We’ll be starting with $250 million in combined annual revenue and plan to grow that.”

As part of the deal, ComputerCorp CEO, Robin Rindel, will become the combined entity’s CEO and be responsible for the operations side of the business. Mavridis will join the board of directors and take on a newly created role as executive director of strategy, as well as focus on further acquisitions.

The combined entity will either be called S Central or listed under a new brand, and will retain 314 staff, including 160 engineers and consultants, across Australia. The companies are hoping the deal will be completed by May 1, subject to shareholder approval. Mavridis said there was little overlap in terms of customers or skill sets.

The decision to merge was fuelled by Hyro’s decision to offload its Synergy Plus subsidiary. Under the arrangement, ComputerCorp will pick up Synergy’s IBM infrastructure business including mid-range server and storage solutions, related managed and hosting services and maintenance contracts, as well as the Synergy Software Holdings division. The deal sees 31 staff join the combined outfit.

The $9.3 million purchase price is payable in cash over a three-year period and dependent on Synergy’s profit performance. The minimum purchase price is $6.5 million.

While S Central will provide most of the technical engineers, Mavridis said Synergy’s IBM expertise would give the combined group a leg-up in that market. He also dismissed concerns of the economic downturn and the need to conserve cash in the current climate. He has personally contributed $5 million in convertible notes as part of the deal.

“This is the best time to do up a brand and build customer loyalty,” Mavridis said.

From ComputerCorp’s perspective, the merger provided the key to expanding its client base, Rindel said in a statement.

“It is a very positive step forward in the implementation of our strategy to create an end-to-end national IT business from the datacentre to the personal user,” he stated.

Hyro CEO, Bill Votsaris, said the decision to sell Synergy was part of a broader review of its business. Hyro will retain Synergy’s application development, IBM application software consulting and application managed services business. It will also offer infrastructure services via an ongoing partnership with ComputerCorp and other providers. Votsaris is a director of ComputerCorp and the previous owner of Synergy Plus.

Follow Us

Join the newsletter!


Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags s centralcomputercorphyrosynergy plus


Show Comments