5 MSPs Merge, Plan Australian IPO

Five managed services providers are merging and planning an IPO on the Australian Securities Exchange. Those companies include CommsChoice, Oracle Telecom, Telaustralia, Telegate, and Woffle. The combination of the companies will yield a company called CommsChoice Group.

CommsChoice Group expects to raise $7.5 million in a Dec. 20 initial public offering. The IPO is an effort to fund the deal as well as future acquisitions.

“Of the capital raising effort, $2.28 million will go to the IT and telecommunications service providers set to comprise the group, while $3.9 million will be used for working capital and corporate expenses, according to a prospectus, dated 28 November,” IDG’s ARN media outlet reported this week. “The prospectus also outlined the combined financials of the companies involved in the listing, along with the expected earnings of the combined entity, revealing that the entities comprising CommsChoice Group generated approximately $20.1 million [~$15 million in U.S. dollars] of revenue and $817,000 of NPATA in FY17.”

Meanwhile, a CHANNELe2e article says the combined the companies experienced compound annual growth of 24.1 percent between 2015 and this year. And it said the new company estimates its 2018 revenues will total AUD$27.83 million (or $20.93 million).

The new company offers cloud services, networking, SD-WAN, UCaaS, VoIP, and related services. It does business in Australia, New Zealand, and parts of Asia, including the Philippines and Singapore. And it caters to enterprises with 250 to 5,000 employees and SMBs with 20 to 250 employees. Among CommsChoice customers are Sheen Group and Wolters Kluwer.

Kevin Ryder of experience management solutions provider iIntegrated Research has this to say about MSPs.“MSPs are uniquely positioned to give support and advice to companies that are driving toward digital transformation. Most organizations today are not on a single UC platform. They’re on disparate platforms from any number of different vendors. To succeed, they need to seamlessly monitor, manage and optimize this multivendor environment. MSPs know how to integrate all the moving parts—the hardware, software, network components, gateways, phones, headsets—to get the most out of these systems. Should organizations want a customized cloud service, MSPs can offer more flexibility than a vendor. The MSP can focus on managing the complexity, freeing the customer to focus on reaping the benefits.”