Branded as a tech consolidator in the staffing and HR space, Canadian junior HIRE Technologies (HIRE Technologies Stock Quote, Chart, News TSXV:HIRE) took another step toward fulfilling its promise Tuesday when it acquired Kavin Talent Management & Recruiting, an Ontario-based staffing services player.
The deal will see HIRE pick up Kavin for $800,000 and up to 200,000 shares of HIRE, depending upon certain milestones. Management said the arrangement was based around HIRE paying five times EBITDA for the trailing 12-month period ending on the second anniversary of the closing.
“Kavin Talent Management & Recruiting has a strong and growing foothold in contract general labour staffing within Ontario and elsewhere in Canada,” said Hire CEO Simon Dealy. “We are broadening and adapting our solutions to meet the demands of the evolving employment market. I look forward to welcoming Steve and the staff at KTMR to the Hire family and am pleased to add their robust line of solutions to our growing list of services.”
Tuesday’s news is a financial and geographical complement to HIRE’s recent acquisition of The Headhunters, a staffing business with strength in the Western Canadian market. The Headhunters generated $4.1 million in revenue in 2019. That deal was structured similarly to the Kavin acquisition, with HIRE agreeing to pay four times EBITDA for the trailing twelve month period ending on the second anniversary of the closing date.
More recently, HIRE invested (US) $200,000 into Atlas ID to bring that company’s COVID-19 risk mitigation platform to employers in Canada.
Speaking to Cantech Letter today about the Kavin deal, Dealy said the company is aiming for both geographical and technological authority.
“Our acquisitions build on our recent transactions by adding new verticals to the company and increasing the solution offerings we can provide our clients and the geographical coverage we can deliver,” he said.
Shares of HIRE Technologies closed Tuesday up two cents to $0.74.
Disclosure: Nick Waddell owns shares of HIRE Technologies and the company is an annual sponsor of Cantech Letter.