Tesserent Ltd (ASX:TNT) has successfully closed its $3.58 million acquisition of Blue Reef Pty. Ltd, a leading provider of cyber-security solutions in the education market.
Tesserent aims to grow its market share both in Australia and internationally, and the Blue Reef purchase is expected to strengthen and expand its business further, particularly in Asia and the United States.
The payoffs from the acquisition include the addition of 150 new clients to Tesserent's customer base and a boost to sales and earnings.
As well it brings an exposure to the education market.
The transaction is expected to be earnings accretive and cash flow positive immediately.
Tesserent, itself a cyber security specialist, has developed a platform for the delivery of managed cyber-security that is used for its own customers, as well as licensed to partners worldwide.
The company provides security, firewall, web filtering, and email filtering to its customers – all of it delivered as a service. It is also responsible for all of the software, the hardware and the support.
Tesserent has announced the issue of 12,875,000 ordinary shares at a price of $0.20 for the part acquisition of Blue Reef.
At March 2016 end, the company had cash of $4.5 million, after an Initial Public Offering raised $7 million and retirement of $1.4 million of debt.
TNT Price at posting:
18.5¢ Sentiment: Buy Disclosure: Held
