Wealthy young IT entrepreneur Dave Stevens has signalled his intention to grow through acquisitions by buying out Melbourne-based young rich list member Peter Mavridis for an undisclosed sum.
Stevens’ Sydney-based IT provider Brennan announced yesterday it has acquired Mavridis’ tech services company SCentral in an effort to increase market share.
The decision comes after a number of tech analysts have suggested the sector will see a rise in mergers and acquisitions in Australia’s crowded IT sector.
The move is the fourth acquisition for Brennan, as the company searches for ways to increase its stake in the mid-market sector.
“The deal will add 50% per annum to Brennan’s revenues as well as extend our customer base and geographical reach into regional centres including Newcastle,” managing director Dave Stevens says.
Stevens was labeled as Australia’s 13th richest person under 40 in 2008 with a value of $109 million, according to BRW. He departed the list in 2009 because he turned 41.
Mavridis, aged 37, was the 26th richest person under 40 on this year’s Young Rich list, with a fortune of $62 million.
According to a statement from Brennan, SCentral’s staff of 75 will remain with the company, but Mavridis “will not be transitioning to Brennan”.
Brennan is emerging as a leader in the mid-market information technology sector, recording revenue of $51 million for the 12 months ending 30 June, a 10% increase over the same period a year earlier.
Stevens said the result was due to the growth of its telecommunications services, including internet plans, and said the company succeeded in taking businesses away from tech giants Optus and Telstra. An emphasis on VoIP and mobile data plans has also increased the company’s revenue.
SCentral operates as an IT consultancy firm, offering data and application management to private companies and government agencies. Stevens said the company’s relationship with Hewlett-Packard and “Citrix capabilities” are key reasons for the purchase.
“Our priority over the coming weeks is to ensure the smooth transition of SCentral’s customers and staff to Brennan. We are committed to investing in our people, R&D and infrastructure to support our growth and allow us to innovate in new service delivery and customer service.”
But the company also said it will be on the look out for more companies to purchase as it enters a growth stage.
“Brennan will seek further acquisitions that provide positive earnings in a minimal time period and have a mid-market focus,” the company said.
Stevens founded Brennan over a decade ago, but has seen the company take off in recent years as the demand for broadband and mobile services grows.
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
