ASX-listed telco and managed services provider Hubify has acquired Sydney-headquartered Connected Intelligence for $3 million.
Connected Intelligence specialises in managed services like private cloud, backup and DR, cloud and SaaS and managed security, as well as telco services like IP telephony and connectivity. The company counts Cisco, Dell, Citrix, Microsoft, VMware and HP as its vendor partners.
Hubify said it shared the same upstream suppliers and platforms with Connected, which it added would allow for seamless integration of technologies and systems. The two companies have also worked together in the past, with Hubify using Connected for overflow technical support and pre-sales.
Connected will also bring in 25 customers billing some $2.6 million annually, as well as a team of system and technical engineers staying on with Hubify.
"I’m really excited about this acquisition and welcoming the Connected Intelligence customers and staff over the coming weeks. Connected is a high-quality recurring revenue business with good margins and long-term customers, which is why it’s a great fit for Hubify,” Hubify chief executive Victor Tsaccounis said.
“This latest addition to Hubify further enables the company to execute on its growth strategy in enterprise managed services and supports our growing pipeline of prospects in this space.
“Positively also, organic growth in the core HFY business remains strong and we continue to work through our acquisition pipeline, and I look forward to updating the market as we continue to close out that pipeline.”
Hubify added that the acquisition contributes to its dual pronged growth strategy to grow both organically and acquisitively, as well as bolstering its expertise in enterprise managed services.
The company also expects Connected will contribute to its plan to increase revenue growth through high net margins, as well as provide cross-sell opportunities across their telco and IT product and services range.
The $3 million acquisition cost was funded by $1.7 million in cash upfront, with the remaining $1.3 million as a deferred payment settled 24 months from completion, which includes an earn out component based on performance criteria weighted mainly on retention of customers.
Last month, Hubify revealed a number of customer contract wins worth a combined $3.1 million from grocery retailer Harris Farm, Point Parking and Grosvenor Engineering for various managed IT services.