Glasgow-based cloud computing firm iomart has acquired Kookaburra Topco, the holding company of Atech Support, for £57 million.
This acquisition, funded through existing cash and an expanded £125m revolving credit facility, is set to bolster iomart’s offerings as a Microsoft Solutions partner. Atech’s 150-strong team, with 128 Microsoft certifications, will join iomart as part of its strategic goal to enhance cloud services for mid-sized UK enterprises.
Despite this acquisition, iomart issued a profit warning, citing customer churn and rising costs, which led to a 7.53% drop in its share price.
The firm expects flat revenues for the first six months of the financial year at £62 million, with adjusted EBITDA falling from £18.6m to £17m and profits before tax dropping from £7.6m to £4.5m.
Atech CEO Ryan Langley will become group CTO of iomart, overseeing the integration and continued operation of Atech.
Lucy Dimes, CEO of iomart Group, added: “We have made good progress on integrating our business, growing order bookings and building better internal capabilities such as product and partner management, to ensure stronger foundations as we move forward with our strategy, during a challenging period of lower customer renewal rates.
“Our acquisition of Atech marks a significant milestone for iomart in our ‘Bigger, Better, Bolder’ strategy.
“Atech was a strategic target for us, and creates a powerful combination of Microsoft credentials, managed security services, high quality referenceable customer deployments, leading-edge technology and global delivery capability.
“This accelerates and plays directly into our vision to be the UK’s leading secure public, private and hybrid cloud services provider, marking the start of the next phase in the evolution of iomart.
“The combined group will be well positioned to retain and grow revenues with our existing customer base as well as present a market leading capability to attract new customers.”
Source: DIGIT