Irish IT and networking services player Calyx has announced its second acquisition within a week, with the purchase of a UK-based IT infrastructure firm ITS Services for €2.76m.
Under the terms of the agreement €2.76m will be paid in cash and €176k in shares (based at Friday’s closing price of 65.5 cent per share). There is also a €735k earn-out split €559k cash and €176k in shares in March 2006 subject to agreed performance criteria.
In August, Calyx CEO Maurice Healy told siliconrepublic.com the company was planning to complete two acquisitions by the end of this year. Last week, the company acquired QCL Technologies, a Cork-based IT product and services company, for €1.2m in cash and shares.
The acquisition of ITS represents Calyx’s first move into the UK ICT market and will allow Calyx to leverage off ITS’s existing relationships with vendors such as Cisco, Nortel and Microsoft. Calyx will be deploying its innovative managed service offering, from its new state-of-the-art Network Operating Centre, via ITS to the existing UK customers and also into new customers.
ITS is already an established provider of converged voice and data solutions for the healthcare, publishing, emergency services and government market, and whose clients include: St Ives Group – a leading print press company; Associated Newspapers – a subsidiary of the Daily Mail and General Trust; Gwent Healthcare NHS Trust – one of the largest and busiest NHS Trusts in the UK.
Calyx, which emerged after Healy led a management buyout of the IT and communications division of Alphyra, earlier this year raised €10.5m through a listing on London’s Alternative Investment Market. Last year, the company reported revenues of €34.5m.
Prior to the past week’s acquisitions of QCL and ITS, Calyx has made at least six acquisitions in the past two years, including the €4.5m acquisition of Moss Technology and the €1m joint acquisition of Vipertec and Bevcom.
In the year ended 31 December 2004, ITS had revenues of €4.6m, profit before tax of €0.65m and net assets worth €76,000. Calyx is expecting to make further investment over the next 12 months in order to provide ITS with the capability to deliver Calyx’s advance solutions based around compliance and remote managed services.
Healy commented: “The ITS acquisition is another step in the execution of Calyx’s strategy to provide advanced infrastructure to its customers. Following the acquisition of Convergent in July and of QCL last week Calyx now occupies a strong market position within Ireland and we now believe we are in a good position to focus on the buoyant UK ICT market.”
By John Kennedy