Sep 09, 2020, 08:30 EST
Bronx, United States, Sep 09, 2020, 08:30 /Comserve / -- The Webcentral Group (WCG) has announced today that it has received a non-binding takeover proposal from the Australian telecommunications carrier, 5G Networks (5GN) and has offered its previous contender, Web.com a chance to equal or counter the bid.
Sydney, September 07, 2020: The Webcentral Group (WCG) has announced today that it has received a non-binding takeover proposal from the Australian telecommunications carrier, 5G Networks (5GN) and has offered its previous contender, Web.com a chance to equal or counter the bid.
According to the company’s announcement on the ASX platform, the proposal by 5GN is based on the implied price of 17.7 cents per WCG share with an implied equity valuation of USD 21.6 million for the company’s business. As part of the deal, 5G Networks has also proposed to provide a loan to pay off all the remaining debt of the Webcentral Group. Through this acquisition, 5GN aims to generate synergies across both businesses on a run-rate basis of more than USD 7 million annually if it wholly acquires WCG and over USD 3 million annually in case it does not hold 100% of WCG shares. The transaction is expected to double the earnings of the Australian telecommunications carrier.
Headquartered in the Sydney region of New South Wales, the Webcentral Group (previously Melbourne IT Group and Arq Group) is a leading full-service digital services partner for small and medium businesses in Australia. It was founded in the year 1996, and it specializes in varied domains such as web hosting, digital marketing, website design and development, search engine optimization (SEO), and pay-per-click (PPC) advertising, among others. Earlier on 13th July 2020, Web.com has proposed to fully acquire WCG shares for USD 0.00727 (AUD 0.10) per share in cash via a Scheme Implementation Deed. The Scheme Consideration rates the equity issued by Webcentral at about USD 8.87 million (AUD 12.2 million). However, WCG directors have stated that the 5GN’s proposal is more superior to that of Web.com, and it will only consider the Web.com company’s offer if it revises its proposal during the given period.
Sharon Rowlands, the CEO-cum-President of Web.com Group, previously stated that the company is excited to welcome Webcentral to its family, and with this acquisition, the Group intends to expand its business in Australia after the successful acquisition of Dreamscape in 2019.
However, it is still uncertain whether Web.com will revise its proposal or not to match or supersede its competitor 5GN.
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