Shareholder faith in ASX-listed services provider Iocom has diminished after the company was forced to concede its acquisition of MUA and a failed outsourcing contract will run the company into the red in the period up to December 31, 2000.
Iocom's shares crashed 30 per cent yesterday, after the company made an announcement to the ASX stating its ambitious acquisition of distribution company MUA had failed to deliver to the company's expectations. MUA and its services subsidiary, MUA Services and Training, were expected to generate $25 million in revenue for 2001 but had ended up costing Iocom money.
The company's woes continued when it failed to secure a 700-seat outsourcing contract with an un-named customer. Iocom had invested heavily in ramping up its Solutions division to accommodate the contract, which Iocom believed it had won.
The news comes after Iocom purchased Melbourne-based IT company IBS in June, and the release of an Iocom-branded CRM suite, FullCRM, at Comdex in October.