Hostworks acquisition by Broadcast Australia will allow it to expand and tackle a larger market, the company says.
The AU$68.9m million deal between Web hosting company Hostworks and broadcast transmission service provider Broadcast Australia was completed this week after being approved by Hostworks' shareholders last month.
Broadcast Australia and parent company Macquarie Communications Infrastructure Group's support will help Hostworks expand, according to Stephen Chapman, Hostworks non-executive director. "As a small company you really have to step your way along," he said, adding the deal will "definitely see an acceleration of Hostworks' scale."
On whether future opportunities could arise from Broadcast Australia parent Macquarie Communications Infrastructure Group's US and UK subsidiaries, Chapman said that to his knowledge there is no plan to put anything together, but there is common ground. "I have no doubt there are opportunities there," he noted.
Having a parent company like Broadcast Australia will make it easier to open offices in new regions, Chapman continued. "I'm sure there are many, many clients we have where business applications could be across borders," he said. "I think you'll find there is increasingly going to be multi-country bits of business. The Internet doesn't worry about boundaries."
Hostworks managing director Marty Gauvin said expansion outside Australia is on the cards, but exactly where and when has not been worked out yet. "We're really at this stage now. The international side is something we're exploring," he said.
Broadcast Australia receives its own benefits from the acquisition, according to its managing director Graeme Barclay: "This acquisition gives Broadcast Australia an entry point into the high growth online market."
Hostworks' Chapman doesn't expect any jobs to disappear with the takeover. "I'd be very surprised if Hostworks doesn't expand," he continued.
Hostworks will run as a separate company with its own separate board. Hostworks' customers include ninemsn, American Express, Sony, Ticketek, the ABC, SBS, AAMI, Sky News and Network Ten.