Hostech discloses acquisition costs
- 16 April, 2010 14:00
ASX-listed Hostech (ASX: HTC) has detailed the purchase arrangements for each of its latest reseller acquisitions.
In February, the company announced plans to acquire four resellers: Anittel, Accord, Axxis and Aspirence to create a services and hosting powerhouse. In an ASX statement, Hostech disclosed it paid $700,000 in cash for Anittel, $3.6 million for Accord, $1.5m for Axxis and $500,000 for Aspirence, totalling $6.3m. Total shares were approximately 214.9 million across all four entities.
For the next financial year (FY2011), the combined company has released a pre-tax profit target of $7m-$9m and projected revenue of $80m-$95m, with a 60:40 split between services and hardware. It is also anticipating gross margins will rise by 38 per cent.
For the financial year to June 30 2010, the company is forecasting $23.5m in revenue with gross profit reaching $8.8m. Hostech is looking to complete the acquisition of Anittel on April 16, with the remainder to be finalised shortly.
Key strategies for the newly combined company include focusing on growing revenues from recurring services including managed voice and data; forging strong relationships with top national businesses; differentiating its service offering through a unified national brand presence and continuing its acquisition spree and organic growth. Hostech hopes to achieve at least $200m in revenue and pre-tax profit to be in line with industry benchmarks.
Under the merger agreement, Ilkka Tales was appointed as the CEO in March. Meanwhile, executive chairman, Peter Kazacos, has hinted that more acquisitions are on the cards.