Atturra bows out of MOQ Limited acquisition bid as Brennan IT bumps up offer to $23.3 million

Managed services provider Brennan IT has emerged victorious in its bid to acquire MOQ Limited, with rival bidder Atturra declining to match the new $23.3 million offer.

In a statement to CRN, Atturra chief executive Stephen Kowal said the company declined to match the bid based on a number of business metrics.

"For us it was simple, we had a set of business metrics where we thought it made sense for us," Kowal told CRN. "With the recent Brennan IT bid we thought we would have to go beyond what we thought made sense."

Brennan IT offered MOQ cash consideration of $0.075 per share, up from Atturra’s latest offer of $0.07 per share made on 11 August 2022, or $21.7 million. Atturra said it has elected not to exercise its matching right under its scheme implementation deed signed 30 June with MOQ.

MOQ has also entered a new scheme implementation deed with Brennan IT, with its directors unanimously recommending that shareholders vote in favour of the deal.

Kowal added that Atturra's strategy remains unchanged, and that the company will continue to expand organically and inorganically.

"Atturra will continue to progress with its strategy of the last few years of driving half of its growth from organic and half from inorganic," Kowal's statement read.

Atturra will continue with its strategy of looking for specialised IT services businesses that have a strong Australian presence, and it will continue to look at ways of accelerating its growth in managed services."

CRN has contacted Brennan IT for comment.

Atturra first announced plans to acquire MOQ on 30 June for $15.5 million, aiming to build one of Australia’s largest nationwide IT services businesses.

Brennan IT came in on 5 August to bid $18.6 million, which Atturra promptly matched using the clause in the scheme implementation deed.

Brennan IT then increased the offer further to $20.5 million on 8 August, with Atturra responding by increasing the bid to $21.7 million on 11 August.

In an announcement from 9 August, Brennan IT was also looking to create one of Australia’s largest homegrown technology companies through the MOQ acquisition, aiming to bolster its growing digital transformation capabilities and its existing managed services offerings.

Brennan said MOQ will provide complementary services and geographic expansion once the acquisition is completed. The company would also be Brennan’s third acquisition in the last 12 months, following Forsythes Technology in August 2021 and Clade Solutions in January this year.

“We are excited to be taking this step forward in our vision to become Australia’s largest technology company,” Brennan IT founder and managing director Dave Stevens said at the time.

“With over 25 years in business, our heritage as one of Australia’s largest and most successful managed services providers has recently been bolstered by two acquisitions. Our strategy of fully integrating acquisitions means our customers and our staff quickly get the full benefits of the merged entities.”