The Distillery buys Oakton's product business

Canberra-based software developer, The Distillery, has purchased the products division of ASX-listed IT services company, Oakton.

Oakton signalled late last month that it was looking to divest its products business, which developed software for the law enforcement industry.

The agreement will see The Distillery purchase $5.5 million of IT services from Oakton as consideration over the next three years.

Oakton will become the developer’s "preferred implementation partner".

The Distillery’s acting CEO, Roger Martindale, said the company’s flagship product, InterQuest, was already used by several Government defence agencies. This meant Oakton’s products already had some potential customers on The Distillery’s books.

The acquisition also comes attached with the goodwill of Oakton’s sales pipeline for the product.

The Distillery has also taken three Oakton staff under contract with the possibility of offering them permanent positions at a latter date.

Martindale said The Distillery was better suited to selling the products, and is not fazed by the lack of success Oakton had in marketing the law enforcement solutions.

“Oakton is a services company – while we are a products company, and what’s more a product company in the law enforcement space,” he said. “We have done our technical due diligence on the software – there is a little more development work needed, and some integration to fit with our products, but overall our engineers found it to be sound.

“This acquisition makes us the absolute dominant player in the law enforcement sector now."