Stream Group Limited (ASX:SGO) agreed to acquire remaining 61% stake in Cerno Limited on December 10, 2014. The consideration for the equity holders (Class A Performance Share Prospectus) is dependent on the future performance of Cerno with nil consideration upfront. Consideration for debt holders (Class B offer) is for 25% of the debt value in Stream Group's shares, escrowed for 12 months. For Class B offer, 2.22 million shares will be issued as consideration. In the year ended June 30, 2014, Cerno reported net loss of AUD 13.62 million. Stream advises that it has received sufficient acceptances under the Class A Performance Share Prospectus to invoke the "Drag Along" rights under the Cerno Ltd constitution, thereby satisfying one of the two conditions for the offer of Class A Performance Shares. The second condition, being the acquisition of all of the Third Party Cerno Shareholders' Debt, has not been satisfied.

As of February 9, 2015, Stream Group Limited announced that it has issued 6.17 million Class A Performance Shares (“CAP Shares”) in accordance with the Class A Performance Share Prospectus. Stream has waived the condition to the offer that all of the third party Cerno shareholders' debt must be acquired under the Class B Performance Share Prospectus. Since this waived condition has not been satisfied, Stream withdraws the offer to acquire third party Cerno shareholders' debt, and will not issue any securities under, the Class B Performance Share Prospectus. The transaction is expected to close before February 28, 2015.


Stream Group Limited (ASX:SGO) completed the acquisition of remaining 61% stake in Cerno Limited for AUD 0.7 million on February 9, 2015.