Today’s world is more dependent than ever on digital connectivity. Spirit Telecom (ST1) – one of Australia’s biggest industry movers in the IT and Internet space  –  is making strides towards becoming the ‘OfficeWorks’ of IT and Internet. In the last 12 months, they have developed all the different ‘aisles’ of their internet one-stop-shop, including support, security, managed Wi-Fi and Cloud Storage.

In its most transformational move to date, Spirit recently acquired VPD Group, a voice, data and cloud services provider operating in QLD and NSW. 

This highly strategic move means Spirit now provides Internet, Security, Cloud and IT services business in every Australian state, creating major business and cross-selling opportunities nation-wide.

‘Businesses need far more sophisticated products these days. They need managed Wi-Fi solutions, they need cloud solutions. We have all of that and now what VPD has given us is the structure to distribute these products via channel partners across Australia’ Spirit’s Managing Director, Sol Lukatsky said in a Live Investor Briefing yesterday.

VPD is a well-established business that provides services to diverse essential sectors including mining, aged care and industry. 85% of its revenue is recurring and it boasts a 98% customer retention rate. They had multiple suitors for the acquisition but chose to go with Spirit because they trust Spirit’s strategy and saw value in their platform. 

The acquisition brings Spirit an additional $15 million in revenue, creating a combined revenue run rate of $70-75 million.

“This is a game changer for Spirit and through the acquisition of VPD Group, Spirit will build and strengthen its cloud, security, data and managed IT services capabilities whilst providing entry into expanded geographies” said Mr Lukatsky.

“We look forward to shaking things up in Telco and IT across Australia and providing the services that Australian SMEs deserve” he added.

Catch up on the recent investor briefing and hear more about Spirit’s recent acquisition from Sol Lukatsky.

Reach Markets have been engaged by ST1 to assist with investor communications.

Any advice contained in the presentation is general only and does not consider your objectives, financial situation or needs, and you should consider whether it’s appropriate for you.

Recorded on 30 June 2020 at 11am.

Sources:

• ASX Announcement from 26 June 2020