Companies: MXM ��

Since its half-year results at the end of February, IT services consolidator Maxima has agreed its eighth and ninth acquisitions, the latter being its biggest yet.

In early March, construction sector specialist SevenThree was snapped up for �1.1m in cash and shares. Then on May Day the group proposed the �18m purchase of 3net, funded through existing bank facilities, the issue of �4m of new shares to 3net’s owners and an �11.5m placing (priced at 260p) with both existing and new institutional investors.

SevenThree, which made �130,000 pre-tax profit on �1m revenue in the year to March 2006, has been bolted onto Maxima’s existing construction software business, adding its customer relationship management (CRM) software expertise to the division’s capabilities in enterprise resource planning (ERP).

3net is quite different, bringing infrastructure to the offering so the group can offer customers networking and security expertise as well as its consultancy services. It made �1.7m profit on �6.1m sales in the year to January. ‘3net is very high growth and has very good margins,’ said Maxima’s chief executive, Kelvin Harrison.

Harrison’s thinking is that being part of Maxima will enable 3net to accelerate its growth through bidding for much larger projects. Being part of the group has helped previous acquisition Hanston win its largest contract just three months after its takeover and Intertech win its largest within two weeks. ‘3net was missing out on winning larger contracts last year as it was seen as not being big enough – we’re confident we will remove that obstacle,’ Harrison added.

House broker Cenkos has upgraded 2008 forecasts slightly to 29.6p of earnings, with the EPS estimate for May 2009 having risen from 30.7p to 36.1p as the full benefits of the acquisitions kick in. Thus, the prospective p/e of 12.5 for this year drops to less than ten times going forward. Add.

Maxima Holdings	AIM	�70.24m	287.50p	4.50p
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