5G Networks Limited completed the acquisition of additional 46.5% stake in Webcentral Group Limited from Keybridge Capital Limited and other shareholders for AUD 7.9 million.
The transaction is subject to 50.1% minimum acceptance condition, no prescribed occurrences' condition, no material adverse change condition, negotiation and entry into a bid implementation agreement between 5GN and Webcentral and unanimous Webcentral Board recommendation. As of September 15, 2020, the proposed scheme remains subject only to customary closing conditions. On September 7, 2020, Webcentral advises that they consider the 5GN Proposal to be a superior proposal to the Web.com proposal. Web.com now has 5 days to provide a matching or superior proposal. Webcentral advises that no action should be taken by Webcentral shareholders pending the assessment. As of September 15, 2020, the transaction was approved by Foreign Investment Review Board. Webcentral Board unanimously recommends that Webcentral shareholders accept the 5GN offer, in the absence of a superior proposal on September 17, 2020, October 13, 2020 and October 15, 2020. As per the update on October 19, 2020, the transaction is subject to approval of shareholders of Webcentral Group Limited. On October 13, 2020, offer has now become unconditional and is free from all defeating conditions. As of October 29, 2020, Board of Directors of Webcentral Group Limited passed the resolution for third supplementary target statement. As reported on October 15, 2020, each of the Directors of Webcentral has accepted the offer. 5GN has a relevant interest of 34.75% in Webcentral. 5GN is now entitled to two Board seats. Joe Demase and Joe Gangi, Director of 5GN were appointed to the Board of Webcentral. As of October 29, 2020, Takeovers Panel has declined to conduct the proceedings for the transaction. As of November 2, 2020, Keybridge Capital Limited has applied to the Takeovers Panel seeking a review of the Panel's decision. The offer period will close on October 20, 2020. As reported on October 9, 2020, the new date for 5GN giving the notice of the status of defeating conditions is October 16, 2020 and offer is now scheduled to close on October 27, 2020. As on October 23, 2020, the offer was further extended till November 3, 2020. The Board of Directors of 5G Networks passed the resolution fore extension of offer period. As of October 28, 2020, the offer period is extended to November 10, 2020.
Keybridge seeks interim orders that 5G Networks not process any acceptances until such time as the Panel has considered this application and that 5G Networks extends its bid by 3 weeks. The President of the Panel has made interim orders that 5G Networks Limited must not process any acceptances received on and from October 23, 2020 and 5G Networks must extend the offer period in relation to the offer for a period of not less than one week. The interim orders have effect until the earliest of further order of the Panel, determination of the proceedings or 2 months from the date of the interim orders. On October 22, 2020, 5GN and Webcentral entered into an agreement to waive the condition to drawdown under the 5GN Secured Loan that 5GN hold a relevant interest in at least 50.1% of Webcentral shares. This waiver is stated to take effect on and from the date that the Webcentral Board consists of a majority of persons nominated by 5GN.
The deal is expected to be transformational for 5GN's earnings, with earnings per share of 5GN expected to more than double on a pre-synergies basis, and further increased on a post-synergies basis. Macquarie Capital (Australia) Limited acted as financial advisor, Andrew Rich of Herbert Smith Freehills acted as legal advisor and Glen Kanevsky, Sean Holmes, Matthew Fraser and Stephen Lomas of Deloitte Corporate Finance Pty Limited, Investment Banking Arm acted as financial advisor to Webcentral Group Limited. Wilsons Corporate Finance Limited acted as financial advisor and Cornwalls acted as legal advisor to 5GN.
5G Networks Limited (ASX:5GN) completed the acquisition of additional 46.5% stake in Webcentral Group Limited (ASX:WCG) from Keybridge Capital Limited (ASX:KBC) and other shareholders for AUD 7.9 million on November 10, 2020. On October 28, 2020, 5GN held ownership of 50.69% of the Company's shares and therefore at that date 5GN obtained control of the Company. The takeover offer closed on November 10, 2020, with 5GN holding ownership of 56.7% of the Company's shares.With effect from the close of the offer period, Andrew Reitzer and Karl Siegling resigned as Webcentral Directors. As on November 25, 2020, The review Panel has declined to conduct proceedings for the transaction on an application made by Keybridge Capital Limited. The sitting review Panel was Yasmin Allen (sitting President), Bruce McLennan and Kerry Morrow. As of January 10, 2021, Keybridge Capital Limited has submitted an application to Takeovers Panel seeking final orders to effect that Webcentral shareholders be provided with withdrawal rights under the 5GN takeover bid. s. Following a capital raising completed in November and December 2020 5GN's holding was reduced to its current level of 44.6%.As of February 5, 2021, panel declines to extend time to make declaration.