Atturra spending spree continues with $49m bid for Cirrus Networks

Atturra spending spree continues with $49m bid for Cirrus Networks

Atturra (ASX: ATA) CEO Stephen Kowal.

Sydney-based Atturra (ASX: ATA) has made its fifth acquisition announcement of 2023 after reaching a deal with the board of its rival Cirrus Networks (ASX: CNW) to buy the managed services and IT solutions provider for $49 million through a combination of cash and scrip.

If the deal goes ahead, it will mark close to $80 million in acquisitions plus earn-outs for Atturra this year, having also forked out for Melbourne-based Hamond Street Developments, The Somerville Group and Silverdrop in Sydney and, most recently, Newcastle-headquartered Sabervox which is due for completion later this month.

It has now been more than a year since Atturra's attempt to buy cloud tech investor MOQ for $21.7 million after several offers, only to be outbid by competitor Brennan by less than $2 million.

Atturra then bounced back by shoring up its warchest at the end of 2022 through a $25 million raise, and today clarified plans to refinance its debt financing by setting up a new $30 million secured revolving debt facility with Westpac (ASX: WBC) - funds that will make up the lion's share of cash required for the Cirrus deal.

The latest 5.3 cents per share (cps) offer represents a 29.3 per cent premium to Cirrus' last trading price, with the target's shareholders given the option to choose the mix of cash and scrip received but with the cash component not exceeding $37.5 million.

The two parties have entered a scheme of implementation deed (SID) for the acquisition with the Cirrus board unanimously recommending shareholders vote in favour at a meeting likely taking place in November.

Atturra describes the Cirrus acquisition as a strong strategic fit, creating one of the largest Australian-sovereign advisory and technology solutions providers, giving the suitor an enlarged customer base with a focus on government, energy and resources and other corporate clients, as well as a strengthened geographic presence in ACT, WA and Victoria.

"The acquisition of Cirrus has strong strategic and cultural alignment with Atturra’s industry and service capabilities and is a positive step towards Atturra’s vision to be Australia’s leading advisory and IT solutions provider," says Atturra CEO Stephen Kowal.

"Cirrus will significantly expand Atturra’s recurring managed service capabilities and will provide an enlarged and complementary client base with significant future cross-sell opportunities.

"Cirrus brings a wealth of expertise in the government and energy and resources industries, having serviced some of the leading names across these sectors respectively, enhancing Atturra’s ability to become a market leader in these sectors. We look forward to working with and welcoming the Cirrus team to Atturra."

Cirrus managing director Chris McLaughlin says the board believes the transaction represents a compelling opportunity for Cirrus shareholders to realise immediate value and further upside potential via Atturra shares.

"We believe our deep expertise in our markets and our focus on delivering outstanding outcomes for our clients will be enhanced by the breadth of resources and strong market reputation that Atturra brings," says McLaughlin.

"Working with Atturra will provide excellent career opportunities for our team and we look forward to partnering with the organisation going forward."

Subscribe Now!
Four time-saving tips for automating your investment portfolio
Partner Content
In today's fast-paced investment landscape, time is a valuable commodity. Fortunately, w...
Etoro
Advertisement

Related Stories

Centuria fund banks tidy returns as second of three inner-Sydney office buildings sold for $103m

Centuria fund banks tidy returns as second of three inner-Sydney office buildings sold for $103m

Property fund manager Centuria Capital Group (ASX: CNI) has cashed ...

MediSecure data breach: why is health data so lucrative for hackers?

MediSecure data breach: why is health data so lucrative for hackers?

The latest large-scale ransomware attack on a health technology pro...

Victoria passes legislation to phase out stamp duty on commercial and industrial properties

Victoria passes legislation to phase out stamp duty on commercial and industrial properties

Victoria’s transition from a stamp duty to a property tax reg...

The Star confirms US casino group Hard Rock has shown interest in striking a deal

The Star confirms US casino group Hard Rock has shown interest in striking a deal

The Star Entertainment Group (ASX: SGR) has confirmed speculation t...