Inabox to acquire Logic Communications for AU$1.5m

Inabox will pay AU$1.5 million for 100 percent ownership of Perth-based managed IT and cloud services provider Logic Communications.
Written by Tas Bindi, Contributor

Wholesale telecommunications and cloud services provider Inabox has announced it is acquiring Perth-based competitor Logic Communications for AU$1.5 million.

Under the terms of the deal, AU$1 million is to be paid upfront, with the remaining $0.5 million to be paid during the 2018 financial year

Inabox estimates the acquisition of Logic Communications to add more than AU$1 million in earnings before interest, taxes, depreciation, and amortisation (EBITDA) in FY18 after synergies.

It will also help extend Inabox's footprint in Western Australia, bringing across Logic Communications' portfolio of more than 50 small to medium-size enterprise clients.

The acquisition will also add 14 engineers to Inabox's team, the company said.

"Through this acquisition Inabox now represents a strong alternative in Western Australia as a full service provider to the SME market segment," Inabox Group CEO Damian Kay said in a statement issued to the ASX on Tuesday.

"Inabox's Perth branch has been one of the quiet achievers, however through this acquisition has announced itself as one of the go-to full service IT, cloud, and telco providers."

In February, Inabox announced it had acquired Hostworks and associated companies from BAI communications for a cost of AU$7 million.

Under the terms of the deal, AU$5 million was to be paid upfront with the remaining AU$2 million to be paid in the 2018 financial year over an 18-month period.

Regarding the Hostworks acquisition, Inabox said it will allow the company to extend its own cloud-based offering and strengthen its position in the South Australian market, as Hostworks currently operates a 24/7 network operations centre in Adelaide.

Inabox made a number of other acquisitions in the last three years, including Anittel, Neural Networks Data Services, and CloudXchange. However, in FY15, Inabox attributed its financial losses to the acquisitions.

In June last year, Inabox sold its Hosted Collaboration Solutions business to Telstra for AU$4.5 million, which it had acquired from Anittel.

For the 2016 financial year, Inabox recorded net profit of AU$859,000, up 245 percent over the previous corresponding period.

Operating revenue was AU$88 million for the 12-month period, up 37 percent year on year from the AU$64 million reported for FY15, while EBITDA increased by 206 percent, from AU$1.8 million to AU$5.5 million in FY16.

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