Technology solutions and advisory group Atturra (ASX: ATA) has today made its fifth acquisition announcement since November, with plans to spend up to $20 million to buy Brisbane-based SAP software solutions partner DalRae Solutions in a deal that is heavily skewed towards earn-out targets.
Founded by Chris Rae in 2015, DalRae supports government, utilities and complex mid-market clients, and was the inaugural recipient of SAP’s Business AI Award.
Atturra has reached an agreement to pay an upfront consideration of $4.8 million in cash for the company, but if performance targets around EBITDA and employee retention are reached over three calendar years there could be a further consideration of up to $15.2 million.
The deal structure compares to a 50-50 split between upfront payments and earn-outs in Atturra's buyout of US-based Boomi partner Kitepipe in March for up to $10 million, and heavier weightings towards upfront cash in its acquisitions of ComActivity, Plan B and Chrome Consulting between November and January.
This aggressive spending on expansion is underpinned by Atturra's strong liquidity, having closed out 2024 with $98.4 million in cash and cash equivalents, as well as undrawn loan facilities of more than $35 million of which the bulk is designated for further acquisitions.
The liquidity position reported at the end of the year represents more than 40 per cent of Atturra's current $324 million market capitalisation. It is against this backdrop that the Sydney-headquartered group also announced a significant 12-month share buy-back plan in April to purchase up to 10 per cent of issued capital.
Atturra highlights DalRae's reputation for building, implementing and delivering solutions that transform its clients’ business processes, providing a suite of SAP Cloud, business technology platform and case management solutions across a range of sectors.
"As a leading technology service provider with a strong track record of targeted and disciplined M&A, Atturra has consistently signaled its intention to establish a meaningful footprint in the SAP consulting and implementation space by being a trusted partner," says Atturra CEO Stephen Kowal.
"The proposed DalRae acquisition marks an important step in Atturra’s long-standing aspiration to expand meaningfully into the SAP ecosystem.
"By combining our national client footprint with the deep SAP expertise of the DalRae team, we are intending to significantly enhance our ability to deliver end-to-end enterprise solutions for our clients."
Atturra expects the transaction to be completed on or around 30 June 2025.
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