BRISBANE, AUSTRALIA: COSOL Limited has entered into a binding Share Purchase Agreement (SPA) to acquire Work Management Solutions (WMS), a Perth-based business that delivers business advisory and technical consulting services to the resources and utilities sectors.
The total consideration payable for WMS’s shareholders under the SPA is up to $9 million, comprising $7 million on settlement and up to a further $2 million upon the WMS business meeting certain performance hurdles in FY23. The upfront consideration comprises $4 million in cash and $3 million in COSOL shares.
WMS serves large-scale mining groups in Western Australia, including Rio Tinto, Fortescue Metals Group, Newmont, BHP, Glencore and Roy Hill.
Clients in other asset intensive industries include Austal, Aurizon, Australian Rail Track Corporation, Snowy Hydro, Geelong Port and CBH Group.
This established, mature business base provides COSOL with an outstanding springboard to build its position in the buoyant WA resources sector.
The addition of WMS’s advisory services and associated proprietary technology platforms represents a significant expansion of COSOL’s existing offering helping extract efficiencies and better financial returns for asset intensive industries and results in a unique and enviable capability across the Enterprise Asset Management (EAM) spectrum.
The acquisition is in line with COSOL’s strategy of delivering to clients exceptional business outcomes underpinned by proprietary IP and growing its global footprint through incremental growth in Australia and North America, and strategic acquisitions that add technical edge, new clients and new markets.
The acquisition will be immediately earnings per share accretive and is expected to complete within three weeks.
COSOL Managing Director Ben Buckley said WMS would strengthen COSOL’s position as a global leader in digital transformation and data exploitation for large-scale organisations within heavy asset industries, as well as providing COSOL with an end-to-end EAM capability.
“COSOL works with our clients to advise, operate and optimise the EAM ecosystem, including people, processes, systems and data to produce quantifiable financial benefits. Every hour in a maintenance shutdown can cost millions, where a one per cent gain in overall asset efficiency can deliver our clients benefits measured in tens of millions of dollars,” he said.
“Our business is entirely focused on making enterprise assets more efficient for our clients and delivering material gains. This too has been the focus of WMS, which has built respect and long-term client relationships in a complementary market segment.”
The WMS acquisition follows the successful integration of Clarita Solutions, acquired by COSOL in November 2021, and AddOns in North America in 2020.
WMS is already a partner to COSOL, providing its advisory services in combination with COSOL’s asset management IP. Following completion of the acquisition under the SPA, the full WMS service offering will be immediately available to COSOL’s broader international client base, which includes major mining groups such as Glencore, Anglo American, De Beers (South Africa), Cleveland Cliffs (North America) and Ok Tedi (PNG).
Beyond mining, COSOL’s clients include the Australian Department of Defence, energy utility TransGrid, Melbourne Water, Pacific National, Unity Water, Navajo Transitional Energy Co (New Mexico) and Niagara Frontier Transportation Authority (New York State).
WMS Managing Director Mark Warrener said the combination of COSOL and WMS would result in a complete offering to the combined client base.
“The blend of the WMS advisory business with COSOL’s asset management services and proprietary software and IP will deliver invaluable insights and efficiencies to our clients in their endless pursuit of optimising productivity and delivering better returns,” said Mr Warrener.
“Major corporations need to capture every possible operational efficiency within their asset intensive ecosystems, where the smallest adjustment either way can make a material difference to financial outcomes.”