The group intentionally concluded several acquisitions around the same time, says Xantium CEO James Murray.
Commenting on the AltX-listed company's latest deal - the R40 million acquisition of Oracle specialist ITQ - Murray says the close timing of the acquisitions allows the new companies to trade as an integrated group for the full financial year beginning next month.
This is the group's second recent Oracle-related acquisition. In March Xantium announced the purchase of 51% of Oracle solutions provider Waymark Consulting.
The group says ITQ's established private sector client base, which includes Medscheme, De Beers and Unitrans, complements Waymark's government portfolio.
The key ITQ executives and vendors - Marc Schrader, Petro Bogatie and Stephen Bracher - have entered into service contracts for a minimum of three years and have provided extensive restraint of trade undertakings at no extra cost.
There has been some concern in the market that Xantium has been buying too many companies in too short a time, reminiscent of the acquisition and listings frenzy of the late 1990s. With the ITQ purchase, Xantium has bought six companies since listing on AltX last August.
But according to Murray, there is no need for concern.
"Management has witnessed the failure of IT groups that boosted critical mass quickly through acquisitions," he says. "We've learned from their mistake of not anticipating the integration phase, and have avoided this by devising a clear integration strategy in advance of concluding the acquisitions."
He adds that the existing flat management structure will help to ease the integration of the various management teams.
Murray says the short- to medium-term focus will be on consolidation and continued organic growth, although the group "will remain opportunistic in respect of acquisitive growth and will buy businesses that make sense for the group".
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