Datamail has big ideas for expansion

By PETER GRIFFIN


A company that has grown a multi-million-dollar business by taking the hassle out of paperwork now has its eye on further expansion and acquisition on both sides of the Tasman.

New Zealand Post subsidiary Datamail and its new acquisition, Outsource Australia, are only a month into a major programme of bringing their businesses together, but Datamail's technology is already being introduced to the Australian market, in particular its VRetrieve document hosting service.

Specialising in business process outsourcing - everything from storing company documents electronically to managing accounts payable entirely online - Datamail last month took a 75 per cent stake in Outsource Australia.

The deal price has not been disclosed, but it was financed through New Zealand Post and goes down as the group's biggest acquisition yet.

With merged revenue of $165 million and 1000 staff on the payroll, the management of Datamail and OSA have some big targets in mind.

OSA founder and chief executive Graham Baillie said the plan was to double the operation's size and grow revenue to $200 million by 2006.

"$200 million isn't an unreasonable target. Growth has been 30 per cent in the past few years," said Baillie, who now owns 25 per cent of OSA.

With its business split evenly between blue-chip public companies and private corporates, the plan was to grow business through the issue of new products and through the acquisition of smaller "bolt-on" companies. The company also has its eye on the Asian BPO market.

The acquisition involved no redundancies, but Datamail's general manager of outsourcing, Mark Spring, said savings on technology infrastructure would be made.

Datamail has among its local clients BNZ, Internal Affairs (where it handles documentation for births and deaths) and Mercury Energy.