Vysarn (ASX:VYS) to buy Project Engineering for $2.6m

• Water service provider Vysarn (VYS) enters an agreement to buy hydraulic and ancillary engineering services company, Project Engineering
• Vysarn will buy 100 per cent of the issued shares in ProEng for $2.6 million from a mix of cash reserves and debt funding
• However, the sale is subject to a number of conditions including a due diligence and the company obtaining funding
• Vysarn says it has already identified organic growth opportunities for ProEng as well as material integration opportunities
• VYS shares are down 1.3 per cent to trade at 7.6 cents per share as of 1:53 pm AEST

Vysarn (VYS) has entered into a share sale agreement to buy Project Engineering (ProEng) for $2.6 million.

ProEng is a hydraulic engineering business that mainly services the resource sector in WA. It also provides ancillary engineering services to commercial fishing and aquaculture sectors.

Under the agreement, Vysarn will buy 100 per cent of the issued shares in ProEng, with the purchase price assuming the business is acquired debt free.

Once the purchase is complete, ProEng will become a wholly-owned subsidiary of Vysarn.

However, the sale is subject to a number of conditions including a due diligence and the company obtaining debt funding.

Based on ProEng’s historical trading results and their expected earnings for FY23, Vysarn expects the purchase will deliver an approximate 20 per cent earnings accretion.

Vysarn said that it has identified organic growth opportunities for ProEng as well as material integration opportunities with Pentium Test Pumping and Pentium Water.

The company intends to “rapidly integrate” ProEng into the Vysarn Group of companies and then pursue growth. This will initially be through the planned expansions of Pentium Test Pumping’s service offering into injection testing and Pentium Water’s expansion into managed aquifer recharge consulting.

On the market, VYS shares were down 1.3 per cent to trade at 7.6 cents per share as of 1:53 pm AEST.