IT services provider PS&C is set to acquire business and technology consultancy Seisma with the aim of growing the overall business and client base.
Melbourne-based Seisma has 120 staff working with customers in financial services, communications and utility sectors, with forecasted revenue of $21 million this financial year.
“The company had identified several areas where it needed to extend its existing business, and it believed acquiring Seisma would fit with its strategy to become a leader within its specialised practices,” PS&C managing director Glenn Fielding said.
“We identified the need to increase our presence in the growing areas of digital enterprise and information management and analytics, and Seisma has shown itself to be a growing IT provider and a specialist in these areas.”
PS&C said the company is a “complementary fit” to its existing business and growth strategy, expanding its service offerings in addition to the increased client base.
“With the acquisition of Seisma, the combined businesses would provide the group with more than 400 billable IT consultants, grow coverage in utilities, communications and banking, and substantially increase leadership and sales capabilities,” Fielding added.
“Seisma is already delivering combined revenue streams of greater than $20 million per annum, providing a platform to grow quickly in the right environment, and we expect the business to continue to show strong growth in FY19 and beyond.”
The acquisition will be paid by a combination of PS&C scrip and cash on an acquisition multiple of between 4.5 and 5.5 times the current financial year’s EBITDA - projected to be between $11 million to $14 million.
Finalising the acquisition is subject to due diligence and board and shareholder approval, which is expected to be complete by no later than 25 April.