$10m acquisition strengthens TechOne grip on councils

TechnologyOne has bolstered its local government credentials with the $10 million buyout of Gold Coast-based Icon Software.

"A substantial proportion of the purchase price is payable on the achievement of an earn-out," read a statement from ASX-listed TechOne.

Icon specialises in planning software used by local government.

"Every day, thousands of people across Australia and New Zealand use an Icon software solution on council websites to track applications and permits, view planning schemes and browse community plans," according to a statement from TechOne.

TechOne will redevelop Icon's application to its "world-class Ci Anywhere platform".

Brisbane-headquartered TechOne already has a strong grip on the local government sector:

Its products include OneCouncil, a "whole-of-council preconfigured enterprise software solution"; and OneBI, which offers dashboards for councils to "turn their data into actionable and relevant information aimed at enhancing decision making".

In the 2014 financial year TechOne secured more than 50 new enterprise accounts, including local government clients Campaspe Shire Council in Victoria and Aylesbury Vale District Council in the UK.

TechOne boasted that in 18 of the 50-plus new corporate customers, it displaced Oracle, SAP and Microsoft.

TechnologyOne goes exclusively direct in its sales model and its chief has been vocally anti-channel. "We do not use implementation partners or value-added resellers," the company stated in its most 2014 annual report.

In fact, TechOne used IBM's Queensland Health payroll disaster as evidence of the "fundamentally broken" channel model for enterprise resource planning (ERP) software.

In November, executive chairman Adrian Di Marco said: "Smart organisations are voting with their feet and moving away from the fundamentally broken model of using third parties such as IBM and Accenture for their implementations, and implementing monolithic systems from the large multinational ERP vendors."

TechOne bills itself as "Australia's largest publicly listed software company". In the 12 months to 30 September 2014, the company increased revenue by 8 percent to $195.1 million and net profit by 15 percent to $31 million.