Tasmea (ASX:TEA) will acquire the civil service and maintenance firm Flanco Group, consisting of Flanco and Flanco Kalgoorlie, for an upfront consideration of around AU$27 million after estimated purchase price adjustments, according to a Thursday Australian bourse filing.

The purchase consideration includes the issue of AU$6 million in Tasmea shares or 1.7 million escrowed shares at an issue price of AU$3.50 per share.

The vendors will be able to earn a total consideration of around AU$50 million, subject to achieving an earn-out overperformance earnings before interest and taxes of AU$16.2 million per annum for four consecutive years under Tasmea's ownership.

The acquisition will be funded via a new AU$24 million bank facility, while the issue of Tasmea scrip, deferred earn-out payments, and overperformance payments will be funded from future cash profits generated by Flanco Group.

Completion is expected to occur in early May.