Vonex has acquired fellow telecommunications services provider Nextel for $1.5 million, giving it access to its infrastructure and telephony cabling business.
The publicly listed company will pay an initial $315,000 in cash and cash equal to the cost of tangible stock items as at completion, estimating a total of $1.5 million.
Vonex noted the initial offering was “conservative” but would help maintain its cash position while “highlighting the belief that the Nextel vendors have in Vonex continuing to grow the combined businesses”.
Founded in 1990, Nextel has historically specialised in NEC Key Telephone Systems, PABX, NEC VoIP Switches and Panasonic PBX , but also has expertise in Samsung, Aria and Commander Systems.
It also provides NBN fibre for small-to-medium-sized businesses across Australia. Headquartered in Sydney and with offices in Brisbane and Melbourne, Nextel also provides services to businesses in remote locations.
According to Vonex, the deal will add $1 million to the base of annualised recurring revenue, with the deal expected to complete on 29 January 2021.
"In Nextel, we see many of Vonex's existing characteristics in terms of capability and culture, which provides us with confidence that we can integrate the business quickly and simply,” Vonex managing director Matt Fahey said.
“The acquisition of Nextel’s established operations will provide an instant expansion of the company’s customer base, particularly in the key NSW market, and will be highly earnings-accretive.”
All staff, including managing director Cameron Lyndon-James, are expected to join the company.
The latest acquisition comes almost a year after Vonex acquired Queensland wholesaler 2SG Wholesale for $2.66 million.
Vonex also shrunk its net loss from $2.79 million last year to $596,000 for the year ending June 30. Revenue grew 67 per cent, from $9.2 million to $15.4 million, while underlying earnings before tax returned to the black, to $25,237 from $454,332 in the red.