LONDON, UK: Calnex Solutions plc (AIM: CLX), a leading provider of test and measurement solutions for the global telecommunications sector, announced the acquisition of iTrinegy Limited. The consideration, calculated on a cash-free, debt-free basis, is £2.5 million in cash on completion with up to a further £1.0 million dependent on achievement of agreed financial targets.
iTrinegy Limited is a leading developer of Software Defined Test Networks technology for the software application and digital transformation testing market.
Founded in 2006 and headquartered in Stevenage, UK, iTrinegy’s NE-ONE hardware and software based Network Emulation platforms provide organisations, primarily across the technology, financial, gaming and military / government sectors, with the ability to accurately recreate complex, real-world network test environments in which to analyse and verify the performance of applications, before deployment. The NE-ONE platform provides users with insight which enables them to reduce deployment costs and risk while at the same time improving quality.
The iTrinegy NE-ONE platform is also applicable for cloud-based and virtual development and testing environments, a rapidly growing sub-sector of the application development market. Many software vendors around the world are repurposing their on-premise hosted applications and solutions in order to deliver these services via cloud-based hosting. iTrinegy’s software includes analytics that allow customers to analyse and predict an application’s performance when deployed in the cloud or running over distributed networks.
iTrinegy’s customer base includes organisations such as Juniper Networks, JPMorgan Chase, Ubisoft Games and the Government and Military in the UK and US. In 2021, iTrinegy was awarded the prestigious Queens Award for Export Achievement. Calnex plans to scale the business by using its sales and marketing capabilities to build, support and grow a reseller network, particularly into the US, to accelerate sales.
iTrinegy generated revenues of approximately £1.4m in the year to 30 September 2021, with a gross margin of around 80%. Approximately 60% of iTrinegy’s revenue was from North American customers. The business is being acquired on a cash free, debt free basis.
The consideration comprises an initial cash payment of £2.5m, with up to a further £1.0m potentially payable in a combination of new ordinary shares in Calnex and cash (the “Earn-out Payment”). The Earn-out Payment is subject to the achievement of certain sales targets from iTrinegy products in the year to 31 March 2024. A maximum of 322,579 new shares will be issued under the Earn-out Payment.
Tommy Cook, Founder and CEO of Calnex, said: “We are delighted to welcome the iTrinegy team to Calnex. With both businesses developing high quality, complex, technical testing solutions, trusted by some of the world’s most demanding organisations, we are particularly excited by the strategic fit of the two organisations.
The cloud migration taking place across multiple sectors and the growth in internet-based applications is fuelling demand for test solutions that can analyse, predict and verify application performance over complex, distributed networks. We see great opportunity ahead for the NE-ONE technology and look forward to working together to accelerate iTrinegy’s growth and open up new customer segments for Calnex.
Following a strong FY22 and a record order book heading into the new financial year, we look to the future with confidence.”
Calnex designs, produces and markets test instrumentation and solutions for network synchronization and network emulation, enabling its customers to validate the performance of the critical infrastructure associated with telecoms networks. To date, Calnex has secured and delivered orders to over 600 customer sites in 68 countries across the world. Customers include BT, China Mobile, NTT, Ericsson, Nokia, Intel, Qualcomm, IBM and Meta.
Founded in 2006, Calnex is headquartered in Linlithgow, Scotland, with additional locations in Belfast, Northern Ireland and California in the US, supported by sales teams in China and India. Calnex has a global network of partners, providing a worldwide distribution capability.