Hubify uncovers its MSP anchor, reveals further strategic growth
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Hubify has added managed service provider (MSP) to its telecommunication and IT suite, acquiring a business to anchor the customer offering.
ICNE Pty Ltd has become Hubify’s (ASX:HFY) anchor in the MSP realm, an acquisition which allows the company to offer one complete, end-to-end IT, managed service, cyber and telecommunications service to the SME market.
It is one of two companies acquired by Hubify per today’s announcement, with the other – Smile Telemarketing – to add enhanced data of over 75,000 businesses across Australia, play a lead role in driving organic growth across the company’s product lines, and contribute new IP and technology to further improve Hubify’s current customer engagement model.
The businesses are forecast to contribute FY22 post-synergy earnings before interest, tax, depreciation and amortisation of $600,000 and $500,000 respectively.
Hubify CEO Victor Tsaccounis, who last month spoke to Stockhead about the company’s growth strategy and desire to secure a MSP anchor, said today’s news was significant.
“I’m really pleased to be announcing these important acquisitions for the company,” he said.
“Firstly, it’s exciting to have acquired our first managed service provider – this is a significant milestone in our growth plans for the company.”
Tsaccounis said Smile Telemarketing was another exciting pick-up.
“Secondly, our contact centre operations play a critical role in our multichannel approach to acquiring, retaining and cross-selling to SMB customers,” he said.
“We will combine our existing call centre with Smile to leverage the expertise and systems to deliver synergies and enhanced capabilities to Hubify.
“Both acquisitions are important for the company as they support our dual-pronged strategy to grow the business both organically and through new acquisitions in the telco and IT space.
“We continue to work through our acquisition pipeline, and I look forward to iupdating the market as more acquisitions are completed.”
Today’s news on ICNE furthers Hubify’s ambition to move up the value chain in terms of the services it provides its SME customers.
Hubify said by expanding into MSP, it could provide customers with outsources services for maintaining, demand planning and other related services to assist them to improve their operations and cut their costs.
The MSP business will complement HFY’s existing 40-person sales team and play a major role in driving additional organic growth through cross-sales and new sales of the company’s expanded product range.
Hubify will pay $2 million split 50/50 in cash and scrip for ICNE, with shares to be issued at the 14-day volume-weighted average price.
The company will retain ICNE management and staff, including founder and CEO John Martin who has over 20 years of experience in IT and MSP.
Smile is an established call centre and lead generation business for tier one telecommunication companies, of which Hubify has been a customer for eight years.
The company is being acquired for a 100% earn-out based on FY22 EBITDA, with a minimum consideration of $250,000 and maximum consideration of $750,000 payable on completion.
The company’s executive management and staff will be retained as part of the transition.
Today’s news makes part of Hubify’s ambitious growth strategy, which involves purchasing like-for-like business to grow customer base, broadening its geophysical presence by buying businesses in different parts of Australia, and broadening its customer offerings through the acquisition of quality services and products.
“We see a huge opportunity in the SME market to be the trusted supplier of communication and IT services across the board,” Tsaccounis told Stockhead in April.
This article was developed in collaboration with Hubify, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.