Ferret's Stock to Watch: SERVICE STREAM LIMITED 08:41, Thursday, 11 January 2007
NEW STRENGTH IN A MERGER TO TACKLE TELECOMMUNICATIONS
Sydney - Thursday - January 11: (RWE Aust Business News) ********************************************************
OVERVIEW ********
A new year and a new name for a merger, could well send Service Stream Ltd (ASX:SSM) into a new era.
The company, which formerly traded under the ASX code of STR, has just merged with Total Communications Infrastructure Ltd (TCI).
The new Service Stream engages over 2,000 people across 21 locations and provides specialist end-to-end services to the telecommunications industry.
The group's expertise is in the areas of fixed-line and wireless infrastructure design, deployment and management, contact centre and logistics.
Yesterday the company announced it had acquired General Purpose Group Pty Ltd (GPG), which specialises in the construction and maintenance of wireless telecommunications networks.
GPG was established in 1999 and provides a strong capability over an extensive range of telecommunications infrastructure.
Directors say the firm's highly competent workforce utilises advanced plant equipment and technologies to provide its core services of wireless base station construction, antenna installation and build of support infrastructure.
Consideration for the acquisition is based on an earn-out and will approximate $4.5 million, representing a multiple of around five times GPG's forecast earnings before interest and tax in the year to June 30.
The acquisition will be funded by vendor terms over two years and from Service Stream's existing cash reserves and facilities.
SHARE PRICE MOVEMENTS *********************
SSM shares yesterday rose 8c to $1.48. Rolling high for the year is $1.75 and low 84c. The group now has 180.3 shares on issue with a market cap of $266.8 million.
The other part of the merged group is TCI which has an established project management unit of highly qualified professionals with extensive international experience in the telecommunications industry.
TCI also maintains a state-of-the-art database system to manage the deployment process. Its programmers modify this system to meet the precise information requirements of the client.
The founders of TCI have been involved in the telecommunications industry since the inception of mobile phone infrastructure rollouts.
Apart from deploying mobile telecommunications base stations on greenfield locations, rooftop and other structures, TCI has tapped into the niche market of deploying specialist mobile infrastructure of the following types: in-building systems (including tunnels and hotspots), HV towers, concealed sites and satellite earth stations.
BACKGROUND **********
Service Stream Ltd is an Australian-owned group of companies.
With a national footprint of 21 branches throughout five states, Service Stream provides end-to-end services predominantly to the telecommunications industry.
The Service Stream group is made up of the following operating businesses:
Service Stream Communications Pty Ltd has three key divisions, providing services to the telecommunications industry: labour hire; installation and maintenance (both telephony & broadband); and recoverable works (which includes network design, asset relocation and construction).
Service Stream Solutions Pty Ltd provides a complete end-to-end solution to clients utilising its contact centre front-end, through to field services and technology solutions.
The contact centre provides a wide range of customer care services including directory assistance, mobile portability, inbound and outbound calls, mobile phone insurance management, to name but a few.
Milcom Communications Pty Ltd, as an independent Registered Training Organisation, provides a structured training platform for telecommunications and IT workforces. This training delivers to the industry a fast growing pool of highly skilled personnel ready to meet the constantly changing needs of the industry.
Fibercom Technology Pty Ltd is a specialist in telecommunications infrastructure design, build and maintenance. It delivers optical fibre, coaxial cable, copper cable and wireless infrastructure solutions. Fibercom also deliver wideband and broadband projects through to narrowband PSTN works.
TCI was established in January 1996 and is a specialist project management company, working within the construction industry, specialising in technology infrastructure deployment.
Although founded to service the communications industry, TCI is migrating its infrastructure deployment skill-sets to other diversified areas such as site lifecycle/asset portfolio management and the utilities sector.
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