Nexion has acquired Australian telecommunications and network solution provider BlueSky Telecom for $2 million in shares.
According to the publicly listed company, BlueSky has national customers across Australia and revenue of $2.9 million.
Nexion claimed the deal will increase its recurring revenue base as a percentage of total revenue and that there "is a strong potential identified for cost synergies".
Founded in 2013 by Daniel Fairbairn, BlueSky is headquartered in Perth and provides owned and operated international hosted voice platform and an MPLS network. According to LinkedIn, it has between 11 and 50 employees in Australia.
It also offers NBN, fixed and wireless fibre networks, 4G plus managed services across Wi-Fi, SD-WAN and cyber security management, among other offerings.
It is said to have around 400 customers in Western Australia, particularly among the mining sector, with its revenue growing by 20 per cent to $2.4 million in the 2020 financial year.
According to its shareholder announcement, the acquisition will serve as a launchpad for Nexion's hybrid cloud service to BlueSky's customers.
"BlueSky is a fast-growing business with an outstanding product offering,” said Nexion CEO Paul Glass. "As a result, Nexion will be a stronger combination of infrastructure and products that should yield material cross-sell opportunities and the possibility of lower costs."
Glass added that improving Nexion's recurring revenue was a key objective that would be helped by the BlueSky buy.
Fairbairn will continue in his role as CEO of Blue Sky once the acquisition is complete. In a statement to the ASX, he said he was "committed to replicating BlueSky’s historical success and creating an even stronger commercial proposition".
Nexion said it expects to complete the transaction during the fourth quarter of this financial year.
The Perth-based company listed on the ASX in February this year but subsequently flagged a net loss for the six months ending 31 December 2020, which represented a 341 per cent decline, year-on-year.