Macquarie Telecom on the acquistion trail

Stuart Corner
Thursday, 25 February 2010 15:36

IT Industry - Strategy

Macquarie Telecom managing director, David Tudehope, says the company now pro-actively looking at potential acquisitions after posting a strong half year result that reflects an increased focus on its hosting business.

Macquarie Telecom’s hosting business posted revenue growth of 27.4 percent on the previous corresponding period, contributing $20.5 million to total revenue of $123.4m. It contributed  EBITDA of $6.2m, up 37.4 percent on the previous corresponding period and almost half total EBITDA of $13.7m.  Macquarie said that hosting now contributes 37 percent of business profitability.

In a presentation on the results the company said: Our vision is to be the best a providing hosting, data, mobile and voice solutions to business and government customers through personal accountable service and management tools."

Tudehope told iTWire that the order on which the businesses were listed reflected their priority the company, but added " Voice continues to be an important part of the business both in revenue terms and profit contribution...We are working hard to maintain profitability even through there is a lot of mobile substitution going on and prices to customers are falling."

He declined to say whether the company was looking at potential hosting or telephony acquistions, or both but said "We are looking quite pro-actively now [at acquisitions] and working through opportunities. The main challenge is always managing people's expectations at to what their business is worth. [Another] challenge is that most telecoms businesses are much larger than ours and most hosting businesses much smaller, but there are opportunities."

The company is well positioned to make acquisitions. It has cash reserves in excess of $50m, up from $28m a year ago, and almost no debt.

Macquarie entered the hosting business a decade ago and now focuses on companies that need mission critical applications - particularly customer-facing web sites. "Those who could not imagine life without their web site even for 30 seconds is our ideal customer," according to Tudehope.

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