Uniti Wireless will raise $100 million to claim its biggest takeover target yet in LNBCo
Uniti Wireless will grow in value by about a third with the acquisition of LBNCo.
Uniti Wireless has launched a $100 million capital raising to fund the takeover of LBNCo, which it says will give its earnings a solid boost this financial year.
Uniti’s value after the raising will surge to around the $300 million mark, up from just more than $30 million when the Adelaide internet service provider listed on the ASX in February.
Since then the company has pursued a rapid acquisition strategy, buying out three other firms, however the LBNCo deal is by far the biggest to date.
Uniti will pay the owners of LBNCo $90 million in cash and $10 million worth of Uniti shares to buy the fibre to the home business.
Shareholders in Uniti will be offered new shares as part of the capital raising at $1.20 per share, compared with the current share price of $1.38, on a 1 for 2.35 shares basis.
Uniti said its before tax earnings, after the transaction, were estimated to be $16.6 million, excluding the contribution from acquisitions made recently by LBNCo.
Uniti chairman Graeme Barclay said the deal would be a “transformational event” for the company.
“The FTTP network deployed and continuing to be expanded by LBNCo is an asset that we feel very privileged to have secured,’’ he said.
“This acquisition provides our company with a platform of growing earnings that will underpin Uniti’s continued ambitious growth strategy.’’
Uniti shares remain in a trading halt while the institutional component of the raising is completed.