Ann: Xref acquires employee engagement platform, Voice Project, page-7

I've been an XRef bull for a while and it represents my largest single holding. Having said that...

I'm a little bemused by the acquisition. One of reasons I've been a fan is that they built the business organically (with the exception of RapidID). I think it's a business that benefits from that. They are trying to sell the hire to retire data - not just the functionality. If you're asking about apples at one end, oranges at the other and the price of fish in China in the middle, the data is not worth a lot. You also need the ability to mesh the data, which is harder when the different systems haven't been built to do so from the ground up.

Some have said it looks cheap. If you're still valuing companies on revenue multiples you probably haven't gotten the memo from 2022. Even on a revenue multiple if they're paying $6m in cash and scrip (does anyone know whether the $2m scrip on 1st and 2nd anniversaries was $2m/year or $2m total?) for $4m of revenue they'll get a bit of private-public arbitrage but not enough for it to be the reason for the move.

Also they'd suggested previously they were building the capability internally. Maybe this gives them a 12 month head start - fair enough I suppose, but if they were building it internally does that mean we'll get a capex impairment?

Finally, let's just say they've correctly identified they have this gap, the best thing to do is to fill it by acquisition and so they go out looking for the best target. Are we to believe that this global company, who did an exhaustive search, just happened to find the perfect candidate not only in their home country but in their home city? That's...convenient?

They've done enough over the past couple of years that they get the benefit of the doubt for now but I'll be looking for a better understanding at the AGM.