Gentrack Group Ltd (ASX: GTK) shares are on the rise on Thursday.
In morning trade, the ASX tech stock is up 3% to $4.95.
This follows the announcement of an acquisition, which is offsetting broad market weakness.
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What did the ASX tech stock announce?
This morning, the utilities software provider announced that it has entered into an agreement to acquire Dubai Technology Partners (DTP).
It is a premier airport technology and services provider based in Dubai, United Arab Emirates.
According to the release, the acquisition will be integrated into Gentrack's airports division, Veovo, expanding its product portfolio, its global delivery scale, and its footprint in the Middle East.
It highlights that DTP's innovative technologies will be integrated as high-value bolt-ons to Veovo's AI-enabled portfolio.
In addition, DTP brings around 60 highly skilled professionals with deep domain expertise in airport operations and flagship Middle Eastern customers including Dubai, Abu Dhabi and Saudi Arabian airports.
The ASX tech stock is paying US$10 million, subject to customary completion adjustments. This will be funded entirely from Gentrack's existing cash reserves.
Management advised that, depending on the final completion date, it expects the acquisition of DTP to add around NZ$3.5 million of revenue to Gentrack's Veovo business across the four months remaining in FY 2026.
It also expects the acquisition to be marginally EBITDA accretive (before acquisition costs) in FY 2026. The good news is the cost of integration will be low and focused on cross sales activities aimed at driving growth in FY 2027 and onwards.
Commenting on the deal, the ASX tech stock's CEO, Gary Miles, said:
DTP is a highly complementary acquisition—technologically, commercially, and culturally. By adding DTP's technologies to Veovo's AI-enabled portfolio and leveraging their prestigious expertise, we can deliver smarter, more automated solutions to our 150+ airports worldwide while establishing a powerful growth engine in the Middle East.
DTP's chair, HE Sultan Al Mansoori, added:
Gentrack and Veovo have demonstrated a proven track record as a leading airport technology provider, underpinned by strong and enduring cooperation with DTP over many years. This partnership represents the natural next step in DTP's development, enabling the team to enhance service delivery for our existing clients while extending the global reach of our high-quality solutions as part of Gentrack. It also provides an excellent platform for the continued growth and development of our highly skilled and motivated personnel.
