Altx-listed Xantium Technology Holdings has expanded its government client base by acquiring 51% of Waymark Consulting (Pty) Ltd for up to R8,4 million. Waymark Consulting is an IT specialist focussing on Oracle applications for government and counts among its clients the State Information Technology Agency (SITA) and the South African Police Services (SAPS).
The purchase price, subject to an earn-out, will be paid over three years in a combination of cash and Xantium shares. Waymark Consulting's key executives, who have retained the remaining 49% of the company, will remain on at Xantium for at least the three years and have signed restraint agreements for no additional compensation.
Xantium CEO James Murray says that the acquisition is in line with the strategy of bolstering Xantium's technology skills and capability with expert consultants and top-ranked applications. Waymark has received the Focus Partner Award from Oracle, reflecting the high skills level in its team. In addition to the Oracle application its 54 professional business consultants have further specialist skills in products such as EMC, the worldwide leader in data storage systems. "Waymark Consulting's expert EMC capability will support the roll-out of Xantium's recently concluded agreement with EMC," says Murray.
He says that the South African government has embarked on a major drive to ensure that processes are technologically enabled to efficiently deliver services to communities across the country. "With Waymark Consulting's expertise and experience in the government sector, Xantium is well positioned to offer government integrated, seamless IT solutions and systems to fulfil its service delivery objectives," says Murray. He points out that clients in other sectors will also benefit from Xantium's now-enhanced ability to generate even greater efficiencies from IT systems.
MD of Waymark Consulting Ernst Scholtz says that the integration into a major empowered IT company will enable Waymark to secure more extensive government work, leveraging Xantium's strong BEE credentials and effective sales force.
The acquisition remains subject to Xantium's completion of a due diligence of Waymark Consulting and regulatory approval. Xantium continues to trade under cautionary in light of ongoing negotiations regarding further acquisitions.
Xantium's share closed unchanged on Thursday at 52 cents a share.
Share
