This would have to be the biggest rising star in IT, well diversified through IT services and online advertising.
Hyro Adds Further $7.3m Revenue from Strategic ACT Acquisition Hyro Limited ASX: HYO
Hyro Limited (ASX : HYO) has agreed to acquire 100% of privately held technology and government services company, One Planet Solutions Pty Ltd (‘OPS’). Under the terms of the Memorandum of Understanding (‘MOU’) Hyro will acquire OPS for an agreed net amount of $2.7 million.
OPS is a Microsoft Certified Partner with a strong presence in the Federal Government market. Key clients include the Department of Industry Tourism & Resources, Department of Treasury, Department of the Prime Minister and Cabinet and the Department of Transport and Regional Services. The acquisition will provide a substantial increase in the scale of operations for Hyro in the ACT and will strengthen the company’s public sector revenue base.
“Hyro has enjoyed strong growth in the Canberra market over the last couple of years” said Hyro Chief Executive Officer, Mr Joe Calavassy. “Our reputation as a provider of Digital Services to governments has shone through with recent projects such as the upgrade of www.act.gov.au, our ongoing work with The Australian Attorney General’s Department and other projects for a range of government agencies.”
“In OPS we have found a team with complimentary skills, complimentary clients and an identical culture of strong client commitment. Merging with OPS will give Hyro instant critical mass in Canberra and will significantly expand delivery capability in that market” Mr Calavassy said.
The forecasts used for this transaction indicate that the acquisition of OPS will add approximately $7.3 million in revenue in 2007 and approximately $1.03 million in earnings, prior to any revenue or cost reduction benefits which may accrue from the merger of OPS operations with Hyro. Taking into account the enterprise value of OPS, the MOU values the acquisition at approximately 2.6 times 2007 earnings.
“Over the last twelve months, we have worked hard to ensure that we have the right management capacity to support not only the organic growth we have forecast for the business, but also the right strategic acquisitions” said Mr Calavassy. “This transaction rounds out a series of acquisitions that the management team have been pursuing over the last nine months.“
HYO Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
