Mojo is an Altona based company selling motorcycles, scooters, ATVs, electric motorcycles and parts.

Motorcycle Holdings said it would buy the company from Michael Poynton and Joschua Carter for up to $60 million on a cash-free, debt-free basis.

The purchase would be done through the issuing of 11.5 million shares (escrowed for two years), $20 million in cash and a deferred payment of up to $10 million.

The deferred payment was based on Mojo’s pre-tax profit for the next 12 months being greater than $14.5 million. If it was between $10 million and $14.5 million the payment would reduce to $5 million and zero if it was below $10 million.

Motorcycle Holdings would increase its debt facility for the cash payments.

It said the deal was at 4.1 times Mojo’s 2022 net profit before tax. It was expected to be 18 per cent earnings per share accretive before synergies and costs.

Both Poynton and Carter would take up senior positions within the expanded company.

MTO’s David Ahmet said the deal made strategic sense for the company he founded.

“We believe the acquisition of the Mojo Group will present significant growth opportunities by introducing the importation and distribution of motorcycles, ATVs and scooters into our existing product offering, increasing our warehouse capacity and expanding our distribution network,” he said.

“In addition, MTO continues to explore other motorcycle franchise opportunities to increase its market share and geographic coverage in Australia.”