Perth IT provider ComputerCorp and Melbourne reseller Leading Solutions have agreed to merge, pending shareholder approval.
ASX-listed ComputerCorp will pay Leading Solutions $500,000 plus 177 million ordinary shares at a minimum of $0.17/share. More will follow depending on the merged entity's profit performance in coming years.
ComputerCorp chairman, Domenic Martino, said the merger -- of two of Australia's largest resellers -- offered full national coverage.
"We had our best operation in Western Australia, smaller in other states. Whereas Leading Solutions was big in NSW, Victoria and Queensland. So this fits together beautifully," he said.
Martino said negotiations had started about six months ago and heated up in the last two or three months. According to an announcement posted to the ASX, Leading Solutions managing director, Frank Colli, will take the reins of chief executive at the merged company.
Robin Rindel, the current managing director at ComputerCorp, would take on two roles at the new company -- chief financial officer and chief operating officer.
"Frank [Colli] and Robin [Rindel] were very thorough at looking at each other and what they bring to the deal and that's a good thing," he said.
Martino said the merged entity would target growth across the board, paying especial attention to services revenue.
"That's where the margins are," he said.