Local IP security distributor Lan 1 has been acquired by investment company and Hills Hoist developer Hills Holdings.
The Hills Holdings operation consists of 32 business and 3000 staff separated into three categories - building and industrial; lifestyle and sustainability; and electronics and communications. Lan 1 will operate as a standalone entity within the latter.
Hills Holdings managing director Graham Twartz told CRN his company wanted to grow Lan 1 rather than dismantle it.
“People think of Hills and they think about clotheslines and industrial, but our most profitable business is our electronics and communications division,” he said. “We’re the market leader in electronic security, professional audio, and we do a lot of work in the television reception area. We've found in the last few years people are moving away from analogue to digital, everything is running across the corporate network.”
“We’ve continued to upskill our people and customers, but to provide the whole offer, you need to provide dedicated IT equipment. Lan 1 came on our radar because it started competing with us, they were selling the same Axis Communications product as us.”
The acquisition will be completed at the end of September. Twartz declined to provide financial details but said the deal would be structured into an upfront cash payment and following cash payment over the next couple of years, pending performance.
Lan 1 is expected to post more than $30m in revenue in the 2013 financial year.
Twatrz said there would be no change to the Lan 1 business. Lan 1 managing director Daniel Lee will remain in his role, while the distributor’s 20-odd staff will continue to operate out of Sydney headquarters. Hills Holdings’ electronics business headquarters is based in Riverwood, Sydney.
“We’ve spoken to the principal vendor partners and they are all on board. Our objective is to make Lan1 a better business by giving it the financial strength and infrastructure of Hills, and allow our other businesses to leverage the skills and product range within Lan 1.”
Hills Holdings' IT business represents the likes of security solutions provider Pacific Communications, digital media solutions provider TechLife, and FTTP provider OptiComm.