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Resource Development Group closes acquisition

Resource Development Group closes acquisition

Resource Development Group (ASX:RDG) has completed the acquisition of industrial electrical engineering and IT services company Intellect Systems in a deal worth $4.5 million.

The mining services company disclosed it had paid $1.25 million in cash and 13.2 million shares for the purchase, funding the cash component through existing reserves.

When the deal was first announced, Resource Development Group said it expected to pay between $4 million and $5 million in cash and shares.

The company predicts that the acquisition will contribute between $3.5 million and $4 million in revenue and up to $1 million in ebit during FY12.

The shares will be held in voluntary escrow for 24 months.

Resource Development Group first announced in September that it would exercise its option to acquire Intellect Systems, as part of a planned series of acquisitions aimed at building a vertically integrated mining services company.

RDG shares stayed flat on Friday at $0.235.

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Tags it servicesResource Development GrominingMergers and acquisitionsASX:RDGIntellect Systems

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