Veris

VERIS ACQUIRES LESTER FRANKS SURVEY & GEOGRAPHIC PTY LTD

OTOC has entered into an agreement to acquire Lester Franks Survey & Geographic Pty Ltd (trading as Lester Franks) (Lester Franks), a spatial engineering and surveying business, for up to $5.0m.

The acquisition enhances OTOC’s geospatial capability particularly with respect to 3D laser scanning and metrology which are in high demand from clients across the property, infrastructure and resources sectors.

Lester Franks traces its origins to the 1960s, based in Devonport, Tasmania. The current management team under Malcolm Lester acquired the business in 2002 and set about developing an innovative geospatial and surveying consultancy, building on an existing operation in Tasmania by building or acquiring operations in Victoria, Queensland and South Australia and securing work at resources projects for BHP Billiton in Western Australia. Today Lester Franks has more than 40 employees and annual revenue in excess of $5 million.

OTOC was attracted to Lester Frank’s reputation and expertise in surveying technology which is increasingly demanded by clients in combination with land and engineering surveying. OTOC is excited by the opportunity to offer Lester Franks’ specialist capabilities across the national network.

The key employees of Lester Franks, including Managing Director Malcolm Lester, will enter into long-term employment contracts with OTOC and will continue to manage the business. Approximately 38% of the purchase price is in OTOC shares and performance payments.

The performance payments will be payable in cash over two years. The performance payments will become payable if revenue is at least $5.75 million at a minimum gross margin of 45%. The introduction of a revenue-based performance measure is designed to accelerate integration into OTOC and the roll-out of Lester Franks’ specialist surveying skills across the national client base.

The cash component of the purchase price will be funded from existing cash reserves.

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