The IPH Ltd (ASX: IPH) share price is up after announcing an automated trade mark platform acquisition called Applied Marks.
IPH’s acquisition
The company said it has accelerated its digital strategy and strengthened its position in the local Australian trade marks service market with the acquisition of Applied Marks.
Applied Marks is an Australian online automated trade mark application platform. It also provides automated registration and intelligence services relating to companies and domain names, both directly to customers and through channel partners.
It’s the number four filer in the Australian trade mark market, representing approximately 4.5% to 5% of the market, with a focus on the retail market.
IPH will continue to operate its existing platforms, whilst it is also expected to extend into other jurisdictions.
The resources and technology acquired as part of the transaction will also contribute to a new digital services function within the IPH business.
The deal will be an upfront cash consideration of $5 million, with a further $2.1 million payable two years after the transaction completes in the form of IPH shares.
This deal’s contribution to group EBITDA (EBITDA explained) in FY22 is not expected to be material.
Management comments
IPH CEO Dr Andrew Blattman said:
“The acquisition of Applied Marks accelerates our digital capability while allowing us to address an expanded market.
“It bolsters our ability to participate in the online automated IP services space, and will support us to evolve our traditional trade mark offering in line with the changing market.
“Over time, we expect to harness this digital expertise in related areas of IP and use those tools to support a more seamless interaction amongst providers, clients and regulatory authorities to generate further efficiencies for our teams and our clients across the regions in which we operate.”
Summary thoughts on IPH and the share price
IPH is an interesting business. It has a strong market position and a solid dividend yield.
But I don’t know enough about the company or the industry to know if it’s worth owning today, but it could be one to put on the watchlist as a diversified pick for income.
