Vection Technologies Signs Agreement to Acquire DXLabs for $2.1M in Scrip
Vection Technologies (ASX: VR1) has executed a share sale agreement for the Vection Technologies DXLabs Acquisition, targeting 100% ownership of Digital Experience Labs Pty Ltd (DXLabs), an Australian digital transformation and solutions business. The all-scrip transaction adds $3.5M in revenue and $0.8M in EBIT to Vection’s Australian operations, with completion targeted for 9 April 2026 subject to satisfactory due diligence.
Vection Technologies signs binding agreement to acquire DXLabs
The executed agreement positions the acquisition as a strategic expansion into Australian enterprise and government markets. DXLabs specialises in automation and integration platforms, serving enterprise customers across insurance, logistics, lending and government sectors. The transaction structure preserves Vection’s cash position through an all-scrip offer whilst aligning seller incentives through performance-based earn-out provisions.
DXLabs reported 39% revenue growth year-on-year for FY25, adding immediate profitability to Vection’s operations without debt assumption. The company helps businesses build, optimise and scale operations through digital transformation solutions and modern intelligence automation tools, complementary to existing technology stacks and AI technologies.
All DXLabs staff will remain with the business post-acquisition, with CEO Luis Nejo committed to growing operations across key markets in Australia and Asia. Integration activities are expected to be complete within approximately one month following transaction completion.
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Transaction structure and financial terms
The all-scrip offer structure comprises upfront consideration plus a performance-based earn-out tied to FY26 EBITDA delivery. The upfront payment values the acquisition at 2.8x EBIT, representing a disciplined multiple for an immediately accretive asset. The earn-out mechanism caps dilution based on actual financial performance, with maximum earn-out ranging from $0.3M to $2.1M in scrip.
| Component | Value | Notes |
|---|---|---|
| Upfront consideration | $2.1M (scrip) | 2.8x EBIT multiple |
| Earn-out range | $0.3M – $2.1M (scrip) | 75%-150% of FY25 EBITDA |
| Revenue contribution | $3.5M | Immediate |
| EBIT contribution | $0.8M | Immediate, no debt |
| Target completion | 9 April 2026 | Subject to conditions |
The earn-out structure ties 75% to 150% of FY25 EBITDA performance to additional scrip consideration in FY26. This aligns seller incentives with performance delivery whilst capping shareholder dilution based on actual results rather than forecasts.
What is an all-scrip acquisition and why does it matter?
An all-scrip acquisition means the acquiring company pays for the target business using its own shares rather than cash. The seller receives equity in the combined entity instead of a cash payment, giving them exposure to future growth whilst the buyer preserves cash reserves for ongoing operations.
In Vection’s case, the structure allows the company to pursue the DXLabs acquisition without depleting cash needed for product development, sales and marketing activities. The sellers receive Vection shares and participate in any upside from the combined business performance.
The earn-out component adds a performance-linked mechanism where additional shares are issued only if DXLabs achieves specific EBITDA targets in FY26. This structure reduces overpayment risk by tying total consideration to actual financial delivery rather than projected performance. If DXLabs achieves 75% of its FY25 EBITDA in FY26, the minimum earn-out applies. If it achieves 150%, the maximum earn-out is triggered.
For growth-stage technology companies, scrip deals provide capital-efficient pathways to acquire complementary businesses whilst preserving cash for operational requirements. The structure also keeps sellers invested in the success of the combined entity, as their equity value depends on post-acquisition performance.
Strategic rationale and cross-sell opportunities
The acquisition positions DXLabs as complementary to Vection’s existing AI and spatial computing solutions. DXLabs specialises in automation and integration platforms, partnering with enterprise solutions across multiple technology providers:
- Workato
- ServiceNow
- AWS
- Microsoft
- Decisions
DXLabs’ enterprise customer base spans insurance, logistics, lending and government sectors, with published case studies for Money3, Fidelity Life and Solution Underwriting (CFC) across Australia and New Zealand. The company helps organisations build scalable and sustainable automation into their processes using modern no-code platforms.
Key management retention ensures continuity of existing customer relationships and project delivery. CEO Luis Nejo’s commitment to growing the business in key markets across Australia and Asia provides operational stability during the integration period.
The combination creates differentiated capability for enterprise digital transformation across ANZ by merging Vection’s XR and AI technologies with DXLabs’ automation and integration expertise. Integration is expected to be complete within one month post-completion, enabling rapid activation of cross-sell opportunities across the combined customer base.
Vection’s integrated digital ecosystems, combining XR, AI and 3D data, can now be deployed alongside DXLabs’ automation platforms to deliver comprehensive transformation solutions for enterprise clients. The ready-made Australian delivery team strengthens Vection’s APAC capability with live enterprise customers across automation-driven industries.
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What comes next for Vection Technologies
Completion remains subject to satisfactory due diligence activities by Vection, with a target completion date of 9 April 2026. The conditions precedent focus primarily on validating financial, operational and legal aspects of the DXLabs business prior to finalising the transaction.
Near-term milestones tracking execution progress include:
- Due diligence completion
- Transaction close (targeted 9 April 2026)
- Integration activities (approximately one month)
- Cross-sell activation across combined customer base
The acquisition establishes a platform for APAC expansion with an established Australian team and enterprise customer base already operational. Management and staff retention ensures continuity of existing projects whilst enabling Vection to layer in its XR and AI solutions across DXLabs’ client relationships.
The one-month integration timeline positions the combined entity to begin realising cross-sell synergies relatively quickly post-completion. The targeted completion date provides a clear near-term catalyst for investors tracking the company’s execution against strategic growth plans in the Australian market.
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