Formally a wholly-owned subsidiary of Interpath Communications, the newly acquired IPA will see the Hostworks client base grow from 30 to 69 separate accounts, and dramatically extend the company's reach into verticals such as finance and retail.
-The acquisiton will work well for all parties as Hostworks gains the market scope to deal with markets which Interpath has developed, whilst Interpath clients can take advantage of more sophisticated reporting, as well as higher levels of network support and availability," explained Hostwork's managing director Marty Gauvin.
At this stage, Gauvin is looking forward to a relatively seemless merger of the two companies' operations, saying that a spate of redundancies in the run up to the acquisition has largely removed any operational overlap.
-It was a condition of the sale that the Interpath branding was replaced, and beyond branding there are very complimentary skills between the companies," Gauvin said. -We still may see some jobs go in Sydney, and others created in Adelaide."
According to Gauvin, the acquisition will also enable Hostworks to lift revenue by about 50 percent, facilitating the company's target for month-on-month profit growth to turn positive in 2002.
-While we could have returned profit in previous quarters we chose to focus on growth," Gauvin said. -It shouldn't take long now to consolidate that growth, although we do expect the full integration of the businesses to extend over a period of several months."
The AU$2,886,000 purchase price will consist of up to $1,150,000 cash and up to AU$1,736,000 via the assumption of various equipment leases contained within IPA.
-We are interested in ensuring continuity of customer knowledge and service, and to that end we have picked up a significant amount of Interpath infrastructure," Gauvin said.
Hostworks will acquire IPA for a total investment of up to $2,886,000 of which up to $1,150,000 will be made in cash and up to $1,736,000 via the assumption of various equipment leases contained within IPA.
