ASI Solutions acquires Int Tec Solutions

THE ACQUISITION PROGRAM

Our Client – The Buyer

Headquartered in NSW, ASI Solutions is a leading IT managed services provider that services commercial customers across Australia’s eastern seaboard. Over its 35+ years of operation, the Business has worked with a wide range of both private and public sector organisations. It focuses on providing holistic technology solutions – from hardware and software procurement to complete managed services – that harness innovation and advanced technology to streamline organisational processes and transform capabilities. Turning over more than $160M, ASI is a highly entrepreneurial business and was named the #1 Fastest Growing Private Australian Company in 2020 by IBISWorld.

Supplementing strong organic growth, the Business’s directors strategically use acquisitions as a means of accelerating diversification and with the goal of cementing ASI’s position as one of Australia’s leading national IT Services Providers. In 2019, they completed the purchases of Canberra-based Forward IT and New Zealand-based BEarena. Then in late 2020, to bolster their in-house resources, ASI’s directors sought external advisors to facilitate their M&A efforts going forward. They engaged Johnsons to provide hands-on practical assistance – spanning the identification and qualification of suitable targets; the management of terms negotiations and price expectations; and overseeing the due diligence and legal processes involving the exchange of information between multiple stakeholders.

The Acquisition Strategy

Johnsons worked with ASI to design a clear acquisition brief that would target IT product & services businesses operating in Australia and/or New Zealand with revenues up to $25M. Other investment criteria included an established offering in IT services, managed services, and/or hardware sales; a portfolio of B2B customers; and an experienced team of technical staff.

Custom research spanned a number of sectors complementary to ASI’s areas of strategic focus – including IT Managed Services, hardware distribution, audiovisual solutions, and unified communications. Johnsons then ran a proactive direct marketing campaign that uncovered 33 qualified, off-market acquisition targets. Further vetting and negotiations with a shortlist of preferred targets resulted in the execution of an Agreed Terms Sheet between the buyer and its top-rated target.

(Read more about how using a Specialised Mid-Market Business Broker Approach to growing your business through acquisitions could get you a better outcome – just like our client).

The Acquired Target

From its base in the regional city of Mildura, Int Tec Solutions provides IT support services to businesses across northeast Victoria. Its offering combines the latest technology with skilled IT experts and results in increased efficiency, reduced costs, and more vigorous security for its customers. For Int Tec, this was an opportunity to establish a succession strategy for its original owners.  

Ausdeck Group sold to Alpin Group

THE DIVESTMENT CAMPAIGN

Our Client – The Vendor

The Ausdeck Group is a collection of specialist manufacturing businesses serving several sectors across the Australian home improvement & construction industries. The Group is comprised of four interrelated business units with vertically integrated supply lines, each operating independently to serve specific market niches. Acquired in 2000 Roll Form Industries (operating since 1977) manufactures roll-formed steel products for residential, commercial, mining, electrical, telecoms and agricultural markets; launched in 2002 Ausdeck Patios & Roofing manufacturers patios & roofing systems for both home improvement and commercial markets; formed in 2007 Bent Sheetmetal manufactures metal rainwater, flashing and gutter solutions for the home improvement and commercial construction markets; and acquired in 2016 Fusion EPS manufactures expanded polystyrene products for the building and laminated panel markets among others. By FY19 the Ausdeck Group employed circa 120 staff across multiple operations in QLD and NSW, with consolidated revenues exceeding $42 million.  

Having built up the combined businesses over almost 20 years, in 2019 Ausdeck Group’s founding director engaged Johnsons to undertake a strategic divestment campaign, comprising the sale of all four business units. His objective was to exit his shareholding, crystalising historical growth, while ensuring continuity for the Group’s businesses, their long-dedicated management teams, and employees.

The Business Sales Strategy

In the context of Australia’s strong building & construction sector, this acquisition opportunity would prove attractive to prospective buyers seeking to leverage Ausdeck’s large-scale advanced manufacturing capacity, its market leading position across complementary product segments, and its strong consolidated balance sheet.

Johnsons Corporate’s custom research & marketing focused on related manufacturing businesses in international markets and comprised the suppliers of metal roofing products as well as diversified building products. In addition, Johnsons commissioned secondary research into the global PE sector to identify firms whose investment parameters spanned the construction supplies sector. Johnsons ran a proactive direct marketing campaign that uncovered multiple interested parties. However, with the advent of Covid-19 and the consequent impact on international travel, a decision was made to refocus the campaign to target Australian family offices & financial acquirers. After a second marketing campaign, Johnsons had generated a total of 32 expressions of interest. Further vetting and negotiations resulted in the selection of a preferred buyer.

(Read more about how using a Specialised Mid-Market Business Broker Approach to selling your business could get you a better outcome – just like our client).

The Financial Buyer

Alpin Group is an Australian integrated investment and advisory house, focused on privately owned businesses in Australia and New Zealand. For Alpin, this acquisition provided an opportunity to back and further develop a highly successful Australian manufacturing firm, as well as a springboard into the growing home improvement and construction sectors.

Fluid Power Services sold to Coventry Group

THE DIVESTMENT CAMPAIGN

Our Client – The Vendor

Founded in 1991, Fluid Power Services (“FPS”) is one of Tasmania’s leading providers of hydraulic engineering services and supplies. Based in Launceston, the Business utilises its in-house technical expertise to provide customers with premium products, high-end services, and bespoke fluid-power solutions. Operating for 28+ years, Fluid Power had built a reputation as a ‘one-stop-shop’, ensuring customers’ needs were met with high quality workmanship. As a result of its leading position in the marketplace, the Business was able to secure strategic supplier arrangements with two leading, global hydraulic equipment manufacturers – Rexroth™ and Hydac™ – further strengthening its customer value proposition. Consistent year-on-year performance saw Fluid Power grow organically to over $6 million turnover in FY20 with a team of nine staff members.

Having built the Business since inception, in 2019 Fluid Power’s two directors sought to exit and begin their retirement by way of sale to a third party – with the objective of finding a new owner committed to the ongoing operation of the Business. When they engaged Johnsons to undertake a national divestment campaign targeting related trade buyers, it was with a clear understanding of the challenges posed by FPS’s regional location and its high dependence on the owners in day-to-day operations. Johnsons was careful to set realistic expectations about the potential impact these factors could have on the sales process.

The National Sales Strategy

For prospective trade buyers, this acquisition represented a solid bolt-on opportunity. At the time of sale, Tasmania’s economic growth was outpacing that of Australia as a whole, and many of the industry sectors represented by Fluid Powers customers were projected to experience ongoing solid growth. In that light, a new owner could expect continuing demand for the Business’s services and would also have further growth opportunities to explore.

Johnsons Corporate’s custom research & marketing focused on Australian providers of hydraulic services & supplies as primary targets. Then, to maximise the pool of potential buyers, secondary research made a comprehensive sweep of related sectors. Johnsons ran a proactive national marketing campaign that uncovered 25 qualified, interested parties. As anticipated, there followed a prolonged period of negotiations which were further complicated by the Covid-19 pandemic. Johnsons remained committed to finding a buyer, eventually securing Offer & Acceptance after a second round of marketing post the initial Covid lockdowns.

(Read more about how using a Specialised Mid-Market Business Broker Approach to selling your business could get you a better outcome – just like our client).

The Strategic Trade Buyer

ASX-listed Coventry Group is a distributor of industrial products and services operating throughout ANZ. Its two divisions, Fluid Systems and Trade Distribution, operate a number of independent subsidiary businesses. This acquisition aligned with Coventry’s strategic turnaround program, which included an expansion of its presence in Tasmania.

Vision Environment sold to Trinity Consultants, Inc

THE DIVESTMENT CAMPAIGN

Our Client – The Vendor

Based in Gladstone QLD, Vision Environment (“VE”) is a boutique environmental consultancy with a wide range of capabilities relevant to saltwater, estuarine and freshwater ecosystems. Its core business is the provision of water quality monitoring services to clients involved in commercial dredging &/or other industrial activities that impact on marine environments. The Business differentiates itself by bringing together a highly qualified and multi-disciplinary team of experts with a suite of its own proprietary research & technology solutions to offer real-time, fully-validated water quality monitoring. The strength of VE’s niche offering – backed by a 10-year track record – has seen this mid-sized, regional operator regularly win interstate engagements as well as overseas in New Zealand.

Vision was established in 2008 by two doctorate holders with deep environmental science experience, focused on applying the rigours of scientific investigation and academic research to the design & delivery of its service offering as well as to the development of its own technology solutions. After more than 10 years building the Business and 18+ years in the industry, the Directors wanted to setup a succession strategy and ensure continued future growth for the Business. They engaged Johnsons Corporate to undertake a sales campaign, seeking a strategic acquirer that could take the Business to the next level.

The International Sales Strategy

For prospective buyers, VE represented an established profitable business with a strong pipeline of future works, in addition to a highly experienced team, loyal customer-base and strong industry relationships. Furthermore, it presented multiple opportunities to leverage the strength of its unique offering and proprietary technologies into new markets &/or geographies.

Johnsons Corporate’s custom research & marketing focused on Environmental Consultancies in Australia and overseas as the primary target market. Secondary research segments spanned Engineering Consultancy, Project Management, Assets & Infrastructure Management, Dredging Services, and Testing & Inspection Services. Johnsons ran a proactive international marketing campaign that uncovered 21+ qualified, interested parties. Further vetting and negotiations resulted in the selection of a preferred buyer, with Offer and Acceptance secured within 16 weeks of going to market.

(Read more about how using a Specialised Mid-Market Business Broker Approach to selling your business could get you a better outcome – just like our client).

The Strategic Trade Buyer

Texas-based Trinity Consultants Inc is a PE-backed EHS (environmental health and safety) consulting company with offices across the United States, Canada, the UK, Asia and Australia. The acquisition of Vision Environment has increased the diversification of its service offering and has further added to its growing geographical footprint in Oceania.

Beemart Fruit & Veg sold to JE Tipper

THE DIVESTMENT CAMPAIGN

Our Client – The Vendor

The Beemart Group (consisting of Wally’s Produce and Beemart) was established in 1960 and operates as a wholesale distributor of fresh fruit and vegetables. Headquartered in Bundaberg QLD, the Business is strategically located in Australia’s ‘fruit bowl’ region, giving it direct access to a wide range of growers across the Wide Bay & Central QLD area. Beemart offers an end-to-end fresh produce service that spans wholesaling, marketing, transport, retail and banana ripening. Its core customer-base of 800+ commercial enterprises represents a diverse number of sectors including independent grocery, restaurant / hospitality, health, education, and wholesale supply. To ensure timely supply, the Business operates via several distribution points including Bundaberg, Maryborough and Gladstone as well as the Brisbane Markets.

In 2019, after almost 60 years of operation, Beemart’s founder decided to seek a strategic buyer for the Business in order to facilitate his transition into retirement. Johnsons Corporate was appointed to assist with a national divestment campaign, comprising the sale of both divisions and associated real estate assets.

The Business Sales Strategy

For prospective buyers, this acquisition presented an opportunity to enter the Wide Bay & Central QLD market through a well-structured and long-standing local business, with a history of consistent financial performance and proven ability to generate recurring revenues. Beemart’s experienced management team, established distribution platform and strong supplier relationships would additionally provide an unrivalled ability to service regional customers and thus the potential to dominate the Wide Bay & Central QLD fresh produce market.

Johnsons Corporate’s custom research & marketing focused on Wholesale Food Distributors in Australia, who had exposure to fresh produce markets. Johnsons ran a proactive direct-marketing campaign that uncovered 12+ qualified, interested parties. Further vetting and negotiations resulted in the selection of a preferred buyer, with Offer and Acceptance secured within 12 weeks of going to market.

Despite the unprecedented challenges brought by COVID-19, Johnsons ensured that the strong vendor-buyer relationship which had been established early on was maintained throughout the prolonged due diligence and legals phases, so that ultimately the transaction was completed to the satisfaction of all involved.

(Read more about how using a Specialised Mid-Market Business Broker Approach to selling your business could get you a better outcome – just like our client).

The Related Trade Buyer

Headquartered in Acacia Ridge QLD, JE Tipper is one of Australia’s premier fresh fruit marketing, wholesaling, and logistics businesses. This acquisition brings the company a strategic footprint in the Wide Bay & Central QLD market along with a complete end-to-end fresh produce offering.

Empowered Learning sold to Modern Star

THE DIVESTMENT CAMPAIGN

Our Client – The Vendor

Empowered Learning (“EMPL”) is a long standing and market leading provider of interactive AV technologies to the education sector. It specialises in delivering a comprehensive ‘one stop shop’ solution to schools seeking to integrate innovative and collaborative technology into the classroom. Over more than 14 years of operation, the Business had successfully navigated the changing learning environment to embed itself as a key supplier of AV solutions to both the public and private educational sectors. Renowned for delivering fully commissioned projects on-time with high levels of customer service and attention to detail, the Business benefited from both repeat business and referrals.

In 2019, having previously taken the business to market via another broker where a satisfactory outcome wasn’t obtained, the shareholders met with Johnsons Corporate to discuss their objectives and EMPL’s likely market value range. After analysing the financials and various discussions, Johnsons Corporate was appointed to identify suitable national and international strategic acquirers and to sell the Business.

The International Sales Strategy

For a strategic acquirer this represented an attractive opportunity, featuring strong year-on-year revenue growth, high levels of repeat business and a solid pipeline from a sizable and financially secure customer-base. With strong sales growth budgeted for FY20, the Business was well positioned to capitalise on various growth opportunities as audiovisual technologies across the education sector continued to develop.

Johnsons Corporate’s custom research & marketing focused on Audiovisual Technology resellers in Australia and overseas as the primary target sector. Secondary segments took into account related markets in Australia – including Unified Communications Providers, Technology Resellers, Electronic Security Providers, and Other Educational Suppliers. Johnsons ran a proactive direct marketing campaign that uncovered 24+ qualified, interested parties. Further vetting and negotiations resulted in the selection of a preferred buyer, with Offer and Acceptance secured within 8 weeks of going to market.

(Read more about how using a Specialised Mid-Market Business Broker Approach to selling your business could get you a better outcome – just like our client).

The Strategic Trade Buyer

The acquirer – Modern Star Group – is private equity backed and Australia’s number one partner and supplier of educational resources to early childhood centres and primary schools, with a growing presence across Asia, including China, Hong Kong and Singapore. For Modern Star this represented a synergistic acquisition that complemented their growth plans and core business.

Workforce Clothing sold to ATOM

THE DIVESTMENT CAMPAIGN

Our Client – The Vendor

Workforce Clothing was a long-standing and trusted supplier of high-quality industrial workwear to a variety of market sectors in WA. The Business distributed a wide range of products including its own brands, Workforce & F-Tech, as well as other reputable makes – with lines spanning shirts, jackets, overalls, pants, boots, protective equipment, and corporate & leisure attire. With its consistent focus on customer service and a competitive offering, the Business built a loyal base of repeat clients, predominantly larger national operators in the mining & resources, engineering services, civil contracting, transport, and manufacturing sectors. It was able to leverage those relationships into interstate sales and the establishment of its own infrastructure in SA and NSW.

Originally founded in 1972, Workforce was acquired by the CIL Group in 2011, a privately-owned diversified industrial products company. In 2018 CIL’s directors made a strategic decision to divest non-core assets and re-focus their energy and resources on core product lines. They engaged Johnsons to undertake a divestment campaign on their behalf, seeking a strategic acquirer with the resources to continue Workforce’s growth and development.

The Business Sales Strategy

For potential acquirers, Workforce presented a compelling proposition, as an established and leading WA supplier with a blue-chip customer base, a stable of reputable brands including proprietary product lines, strong sector diversification, and a highly capable sales & service team. Looking forward there would be multiple future growth opportunities, including the potential for further geographic expansion and the ongoing development of the own-brand product range.

Johnsons Corporate’s custom research & marketing focused on identifying Australian suppliers of industrial workwear as a primary target segment. Additionally, suppliers of personal protection equipment and corporate workwear were targeted as secondary, or related, segments . Johnsons ran a proactive direct marketing campaign that uncovered 15 qualified, interested parties. Further vetting and negotiations resulted in the selection of a preferred buyer, with Offer and Acceptance secured within 8 weeks of going to market.

(Read more about how using a Specialised Mid-Market Business Broker Approach to selling your business could get you a better outcome – just like our client).

The Related Trade Buyer

ATOM is one of Australia’s leading and fastest growing Industrial Hardware & Safety Equipment suppliers, servicing the Mining & Civil, Oil & Gas, Government, Electrical, Maintenance Repair & Operations, Commercial, Construction, Agriculture, Infrastructure & Engineering industries. This acquisition served to extend its product range as well as its geographic scale.