ASX listed recruitment firm Ross Human Directions Limited has acquired competitor Spherion Group in Asia-Pacific, in a $31 million deal.
Under the agreement, Ross would pay $20 million upfront with a further $5 million payable on September 30 next year. A further payment of $6 million would be payable based on performance of the business for the 2005 fiscal year.
The acquisition doubled Ross' revenue to about $350 million per annum, broadened its geographic span and improved its product offerings, the company said in a statement.
Spherion Group -- a subsidiary of US-based Spherion Corp -- employed around 250 staff and had operations in 11 locations in Australia, Hong Kong, New Zealand and Singapore with a revenue base of $170 million.
It would become a separate business division of Ross Human Directions.
"The acquisition represents a significant consolidation step that will position Ross Human Directions as a major player in recruitment, technology and HR outsourcing in Australia, with further growth opportunities in the Asian region, said Julia Ross, managing director at Ross Human Directions.
Ross intended to raise up to $12 million in new equity from the acquisition, which was being funded through credit lines with National Australia Bank.
Jack Cowin, founder of the Hungry Jack's restaurant chain subscribed for 7.84 million shares at an issue price of 67 cents per share raising $5.25 million.
Ross expected to report a net profit after tax of between $3.6 million and $3.8 million for the year ending June 30, 2004.
Ross shares were trading at 69 cents per share on Monday afternoon.