With the need for agile communications in response to the working-from-home phenomenon, domestic tech company Knosys (ASX: KNO) is set to expand internationally following the acquisition of intranet service provider GreenOrbit.
A leading provider of intranet solutions that assist internal teams with secure communications and data sharing, GreenOrbit (GO) has more than 260 clients including blue-chip companies such as Harvey Norman, Webjet, Cotton-on and Audi.
The acquisition of GO will form the second pillar of Knosys’ international expansion pathway and complement their existing Knowledge IQ platform which is a cloud-based service that integrates internal workflows into one platform designed to improve customer experiences.
“GO will accelerate the growth of Knosys’ Intelligent information management and workplace platform by delivering an exciting new solution to current and future customers,” said Knosys Managing Director, John Thompson.
“This acquisition fast-tracks our product roadmap with an aligned technology solution. We are particularly excited about the opportunity to target organisations with mid-sized and large workforces via GreenOrbit’s employee communication, collaboration and information solution. It fits perfectly within our vision to deliver the right information at the right time.
“The combination of the joint capabilities of GO and Knosys will create an enhanced information management and digital workplace solution company which Knosys is confident should open up greater opportunities.”
From their existing client base, GO generates around $2.8 million in annual recurring revenue where clients sign on with annual licensing fees depending on the size of their organisation. These clients are serviced by 20 GO employees in Australia, the US and UK as well as a support team of 20 that are based in India.
To fund the acquisition. Knoysys will issue $5 million in KNO shares to the existing owners which will give them 19.1% of KNO shares that will be on issue.
With additional staff now located around the world acquired through GO, international expansion of GO and Knowledge IQ will be a core focus of the Australian tech company over the 12 months, seeking to capitalise on the rising number of workforces that have adapted to remote working conditions brought upon by the coronavirus pandemic.
For FY20, Knosys reported $3.1m of revenue for a $0.9m net loss but the Company appears to have turned those losses around very quickly, reporting $2.1m in cash receipts for the Quarter ending 30 September 2020 with $1.1m positive net cashflow.