2SG Wholesale provides Australian Managed Service Providers, ISPs and System Integrators with access to the latest in hardware and connectivity solutions from leading brands.
The proposed transaction brings 2SG Wholesale’s proprietary billing and provisioning systems, staff and equipment, contracts with major telecommunications companies, 140 wholesale customers, stock and no debt.
In FY19, 2SG achieved a revenue of close to $7 million, with revenue from mobile broadband a key growth driver.
2SG Wholesale is expected to generate EBITDA in the first financial year post acquisition (FY21) of about $750,000.
Importantly, the acquisition is complementary to Vonex’s business of selling mobile, internet, traditional fixed lines, and hosted PBX and VoIP services - predominately to the small to medium enterprise customers.
Expansion of wholesale customer base
Vonex managing director Matt Fahey said: “The acquisition of 2SG Wholesale’s established operations will provide an instant expansion of the company’s wholesale customer base, and will be highly earnings-accretive.
“It will empower Vonex to add value to our wholesale and retail customers through better network access, new proprietary billing and provisioning systems and the latest telco products and services.
“We look forward to growing more rapidly and profitably as we integrate 2SG Wholesale’s operations into Vonex’s fast-growing existing business.”
The acquisition is subject to Vonex completing legal and financial due diligence to its satisfaction, which is likely to complete prior to January 15, 2020.