• Divestment of Competency Training for $11.5 million
• Acquisition of Alliance Automation for $5.5 million
• Expanded digital capability and geographic footprint

Verbrec Ltd has announced two significant transactions - the divestment of its Competency Training business and the acquisition of Alliance Automation. The Competency Training business was sold to RelyOn for $11.5 million in upfront cash consideration. This divestment will allow Verbrec to further strengthen its balance sheet and invest in organic growth opportunities and acquisitions that support its purpose of 'enabling a sustainable future for its clients and their customers'. The acquisition of Alliance Automation, an electrical engineering and industrial automation services provider, for $5.5 million upfront cash consideration will enhance Verbrec's digital capability and expand its geographic footprint. Alliance Automation has a strong focus on Industry 4.0 and the convergence of information technology and operational technology, which aligns with Verbrec's strategy. The transaction is expected to add over $60 million in annualized revenue and result in a combined group with approximately 700 team members across 18 locations in Australia and New Zealand. Verbrec and Alliance Automation share a common client base and service tier one customers, including BHP, Rio Tinto, Santos, Origin Energy, and SA Water. The combined group is well-positioned to pursue revenue growth and synergy opportunities, with Verbrec's management team having a strong track record of improving business performance.

The transaction is expected to add over $60 million in annualized revenue and result in a combined group with approximately 700 team members across 18 locations in Australia and New Zealand. Verbrec aims to increase revenues, enhance project delivery to reduce cost of goods sold, and realize synergies in expenses to bring the combined group's EBITDA margin to 8.0% - 10.0%.

The acquisition of Alliance Automation will provide growth opportunities and synergies to the combined group. Through an expanded national footprint, enhanced capability, increased headcount, and a common set of core clients, the group is well positioned for revenue growth. Verbrec and Alliance Automation derive their revenue from different industry sectors, resulting in a resilient and diversified revenue baseline. Management are confident of improving the merged Group's EBITDA margins in the near term.