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NATIONAL Veterinary Care (ASX: NVL) has acquired a specialist vet systems business, marking the start of a different kind of revenue stream for the Brisbane vet company.
NVC purchased Complete Vet Systems (CVS) for $0.82 million, including $0.16 million in shares. The business is expected to deliver annualised revenue of $0.51 million and EBIT of $0.15 million.
NVC managing director Tomas Steenackers (pictured) says CVS provides paid management services to veterinary clinics which aren't always acquisition targets of NVC.
"CVS will allow us to generate revenue we would otherwise miss out on," says Steenackers.
"The business is also an important strategic fit and allows us to further realise one of our core strategies where we wish to partner with as many veterinary professionals in the industry as possible, and to provide them with education and value-added activities which are ultimately aimed at ensuring NVC helps to increase the standards of care for Australian pets and their owners."
This is the first acquisition NVC has completed in management services.
Steenackers believes this is a growth sector in the highly fragmented Australian vet industry worth $2.4 billion.
The acquisition is expected to be earnings per share accretive in the 2016 fiscal year. Thew total remaining up front consideration will be funded through free cash.
NVC shares will be issued at the volume weighted price of $1.395, calculated based on its shares sold for the fifteen consecutive trading days immediately prior to 26 April 2016.
Just over half a year since its ASX debut, NVC is performing ahead of expectations to show the market can handle another vet-and-pet player.
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