Recruitment Market Segment LS
Recruitment Market Segment RS
Thursday, 12 July 2007 13:11

Recruiter Candle enters IT services via $4 million plus acquisition

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IT and professional services recruiter Candle Australia has expanded into the information technology on demand services market with a multi-million dollar acquisition of managed IT services and IT professional staffing business the Jav IT Group. The move takes Candle outside its traditional recruitment business for the first time.

The contract is subject to a number of ‘conditions precedent’ to be satisfied over the next few weeks. Candle, via a newly formed subsidiary, will make an initial payment of $4 million with incentives for profit growth over the next few years.  The acquisition will be funded by a combination of cash and scrip.  According to candle, the acquisition will be EPS accretive in the first year.

The Jav IT Group is an emerging specialist IT services company in Australia and New Zealand, providing services such as IT vendor management, IT professional staffing, IT “resources on demand”, media logistics, data centre management and infrastructure services.

According to Candle, the acquisition heralds the introduction of a new line of services for Candle Australia designed to leverage its existing infrastructure, assets and business knowledge of the IT services market.

Robert Collins, Candle Australia managing director says: “While we plan to preserve our core services in recruitment, the acquisition of the Jav IT Group is a natural next step in our strategy of diversification and growth via acquisition.  Since Candle Australia’s inception over 23 years ago, we have been a provider in the IT services market.  Over the last five years, tremendous growth opportunities have emerged in this sector, not only in Australia but also in Asia Pacific.  Whilst our interests lie primarily in servicing lower risk areas of the market, there will be further opportunities for growth.”

With turnover approaching $16 million, the Jav IT Group has offices in Melbourne, Sydney, Brisbane, Auckland, Wellington, Kuala Lumpur and Beijing. It has a core of 22 permanent staff and regularly engages over 300 professional IT staff on fixed contracts to service major corporations in the region.

“There is a clear strategic rationale for the expansion into this market. We have the management knowledge and expertise, the financial resources, the physical footprint, the candidate and client base and now, with the Jav IT Group, the facilities and disciplines to be successful,” says Collins.

“Our existing client relationships will not be impacted by this initiative and indeed, many of our existing clients will become beneficiaries of this move,” he adds.  

Joseph Vella, founder and managing director of the Jav IT Group says: “We’re extremely pleased about this new relationship with Candle Australia.  Our growth over the last few years has been outstanding and with Candle Australia’s capital support, geographic footprint and existing client base, the potential exists for us to be a major IT services player in the Asia Pacific region.” Mr Vella will retain his position as managing director of Jav IT Group.



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Stan Beer

 

Stan Beer co-founded iTWire in 2005. With 30 plus years of experience working in IT and Australian technology media, Beer has published articles in most of the IT publications that have mattered, including the AFR, The Australian, SMH, The Age, as well as a multitude of trade publications.

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