Xero Completes Practice Management Acquisition

Market Release

Xero Completes Practice Management Acquisition
23 March 2012

Online accounting provider Xero (XRO) has completed the recent acquisition of leading software developer Max Solutions Holdings Ltd with the issuing of 1,261,830 shares valued at $4m to the founders of Max Solutions. Xero acquired Max Solutions in February for $6m - $2 million in cash and $4 million in Xero shares. The issue price was based on the 20 day VWAP and the shares will vest over three years.

Max Solutions founders Gavin George and Chris Spence have joined the Xero team in Auckland at the company’s new development and sales office.

Max Solutions primary software product, WorkflowMax, (WFM) is the successful online job, time and invoice management solution used by more than 1500 businesses in 35 countries.

Since the acquisition, the take-up of the practice management component of WFM has exceeded expectations - already more than 200 accounting firms in New Zealand have committed to migrate to the product. The adoption of the WFM practice management system, which is integrated into Xero’s core products, will accelerate full accounting practice conversions.

“Changing the online accounting product category to include practice management is a disruptive move in the online accounting space,” says Rod Drury. “The early demand for WFM shows this is a good investment.”

In Australia WFM has been received with great interest and Xero expects take-up among accounting firms to be strong in the lead up to the end of the financial year on June 30. Plans are also underway to introduce WFM to the UK and USA.

ENDS

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