How a $6m Perth reseller could float on the ASX

Perth integrator Cirrus Networks is the latest Australian IT company to be the subject of an acquisition proposal by a mining company.

Cirrus Networks has entered into an option agreement that could see fellow Perth company Liberty Resources acquire 100 percent of the integrator. The mining company has three months to exercise the option and is in the process of undertaking due diligence.

If the acquisition goes ahead it would cap what has been a flying start for Cirrus Networks, which was established in 2012. The company recorded $5.9 million in revenue in the financial year ending June 2014 and is already looking to the east coast at potential opportunities, said managing director Frank Richmond.

"We have been talking and are still talking to potentially complementary companies with good synergies," Richmond told CRN. "We’ve talked to two or three in different states, but those discussions are still ongoing."

Last month, CRN named Cirrus Networks as one of its "Five Aussie tech firms looking to shake up the ASX" and reported that the company had narrowed down its shortlist of backdoor listing candidates to three.

The Perth firm counts the likes of Argyle Diamonds, Western Australia Police, LandCorp and Roy Hill Iron Core among its customers. 

Cirrus has Elite partner status with Juniper Networks as well as a partner lineup that includes Aruba Networks, Dell, F5, iiNet, NetApp, Mitel, Microsoft, Riverbed, Palto Alto, Polycom, Symantec, Vmware, Silver Peak, APC and Apple.

"We’ve come up against all the international companies you’d expect and national businesses and we’re still winning business. There is a massive market for players like ourselves that bring the latest technology to market but are very agile and able to respond quickly to customers needs," Richmond said.

Liberty Resources is also based in Perth and describes its main priority on its website as evaluating its discovery of coking coal in the Bowen Basin, Queensland. The company lists a long term goal of producing low cost, clean energy and fertiliser from coal.

Cirrus Networks is just the latest of a number of Australian IT companies forging alliances with resources companies. They include Bulletproof Group Limited, which listed on the ASX this year after a reverse takeover with Spencer Resources last year.

Security vendor Cocoon Data Holdings also announced a reverse takeover with Prime Minerals this year, while 3D Group and Cloud Lands are both the subject of potential takeovers by resources companies.

Meanwhile, at least two local tech companies – CloudCentral and PRM Cloud Solutions – have failed to get their public floats off the ground.