Acquisition-hungry company snaps up reseller for $5.4m

An Aussie ICT firm co-founded in Hobart 10 years ago by a then 23-year-old has been acquired for $5.4 million.

The cash and equity deal sees Hobart-based Insight4, a Microsoft-certified partner with 40 staff, acquired by RXP Services, a publicly listed, 301-staff services provider that counts the likes of Macquarie Bank, NAB, ANZ, Westpac, Energy Australia and the Queensland Government among its customers.

The acquisition follows Insight4's move five years ago to concentrate on the Microsoft enterprise space, specialising in SharePoint, Dynamics CRM, .Net and SQL. The company has seen growing acceptance of Microsoft platforms as a competitor to the likes of Oracle and IBM, said co-founder and managing director Jared Hill.

"Back 10 to 15 years ago, [customers] would have had something from IBM and something from Oracle. Microsoft has gained more market share and we've been part of that," he said.

Hill was 23 when he and three others started Insight4 in Hobart in 2003. The company attracted private investment in 2006 and a year later found a big break when it was listed on a preferred vendor panel in the education market in Tasmania, Hill said.

"From there we started to pick up most of the public sector agencies in Tasmania. Once you start to get that credibility it certainly opened up a lot of doors for us," he said.

The Hobart company's Microsoft development capabilities will add "significant depth" to RXP's growing application development business, according to a statement from RXP. While RXP had Microsoft capabilities prior to the deal, "it was minimal", according to RXP's chief financial officer Chris Shearer.

"We were accredited as a partner, but this certainly strengthens our capabilities," he said. "We're obviously trying a lot more to specialise in a lot more of these [technology] verticals." 

Shearer also noted the geographic location and key clients as other reasons for the acquisitions.

This is the fifth acquisition since July last year for RXP, which competes with ASX-listed business such as SMS, DWS, UXC and Oakton. The company is forecasting that revenues for the year will rise to $48 million, up from $30.1 million in the 2013 financial year.