GCS announces GIS acquisition

Construction services firm Global Construction Services has announced the purchase of specialised labour hire company Global Industrial Services, for approximately $42 million.

GCS said it would acquire GIS for a cash payment of $16.4 million and 14.3 million GCS shares.

GCS Managing Director Enzo Gullotti said the acquisition represented a major boost for the group, delivering significant revenue and earnings growth.

"The acquisition also brings good balance to GCS in that GIS is a low capital intensive business compared to our core existing services which have higher capital demands," said Mr Gullotti.

"GIS is exposed to a broad number of sectors that are complementary to the GCS business, including commercial construction, civil construction, oil and gas, industrial services and energy.

"The key principals of GIS each have more than twenty years of experience in the West Australian labour hire industry.

"In addition, GIS services a range of blue-chip construction companies, some of which are also GCS clients. So there are rich synergies and great opportunities for further cross-selling of services."

Meanwhile, GCS has upgraded its full year profit forecasty to 19 million after tax, up 67 per cent on the previous year, not including the impact of the acquisition of GIS.

Mr Gulotti said the copany would seek to win new contracts on the back of the GIS acquisition, and increase its exposure to increased activity in civil construction, infrastructure projects nad oil and gas sertvices.

"We will continue to grow GCS, allowing us to take greater advantage of the major scale business opportunities that WA has to offer over the coming decade from already committed projects," Mr Gullotti said.

"We will continue to approach this on a disciplined basis, applying a strict focus to all aspects of the business, and will build size in the group through organic and acquisitive growth, nationally and internationally