The People Infrastructure Ltd (ASX: PPE) share price will be on watch this morning. This comes following the company's announcement after yesterday's market close that it will acquire a leading technology staffing firm.
The People Infrastructure share price finished Thursday's trading session at $3.41, up 0.89%
People Infrastructure focuses on the delivery of workforce management, contract staffing, recruitment and human resources outsourcing services. The company operates under four main industry sectors being healthcare, information technology, specialist services and labour hire.
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What did People Infrastructure announce?
In the release, People Infrastructure advised is has entered an agreement to acquire eCareer Employment Services Pty Ltd and Illuminate Search and Consulting Pty Ltd.
According to People Infrastructure, the businesses were established in 1999 and, together represent a leading technology staffing firm focused on the New South Wales market but also with Victoria operations.
The firms mainly provide workforce personnel to the New South Wales Government, as well as large corporations in the banking, finance and insurance industries. They have 16 employees and around 200 technology contractors that have been on-hired by customers.
Terms of the deal
People Infrastructure will acquire both businesses for $5.15 million. The transaction is due to be finalised in the coming weeks, pending customary conditions.
The purchase of the businesses will come from People Infrastructure's existing cash reserves.
Furthermore, the company is projecting the procurement will generate $1.3 million in earnings before interest, tax, depreciation and amortisation (EBITDA) over the next 12 months.
What did the CEO say?
Mr David Cuda, People Infrastructure CEO, commented on the takeover, saying:
The acquisition of eCareer and Illuminate is highly complementary to our existing Victorian and Queensland focused technology staffing businesses. The Business is well entrenched in the NSW market and will enable further growth in the technology on-hire contracting market to NSW government departments, large banking, finance and insurance organisations, all of whom are large users of on-hire staffing services.
People Infrastructure is especially attracted to the Business due to its strong position in the NSW technology on-hire contracting market, its long-term relationships with its customers and proven leadership team who all have significant tenures within the Business and technology staffing industry.
About the People Infrastructure share price
The People Infrastructure share price has rebounded strongly since its March lows of 90 cents. Since the beginning of the year, the company's shares have risen by around 8%, outperforming the All Ordinaries Index (ASX: XAO).
People Infrastructure has a market capitalisation of $314.9 million and a price-to-earnings (P/E) ratio of 16.7.
