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Swoop Holdings acquires 16.99% stake in Vonex as full ownership battle heats up

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By Imelda Cotton - 
Swoop SWP Vonex ASX VN8 takeover bid
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Australian fixed wireless network provider Swoop Holdings (ASX: SWP) has finalised the $2.45 million acquisition of a 16.99% equity interest in telecommunications company Vonex (ASX: VN8).

The on-market purchase of 61.4 million shares at an average price of $0.04 follows Swoop’s bid earlier this month for full ownership of Vonex in competition with a proposed takeover by Queensland-based Maxo Telecommunications priced at $0.0375 per Vonex share.

Swoop’s proposal is expected to allow Vonex shareholders to share in the exposure and potential upside of a stronger and larger combined entity, with synergies representing over $5m in EBITDA on an annualised basis.

Mutual benefits

Swoop chair James Spenceley said the transaction made sense for shareholders of both companies.

“Swoop is in a strong position to be able to acquire the Vonex business and integrate and extract material synergies,” he said.

“This acquisition, combined with recent large infrastructure contract wins, successful non-core asset disposals and demonstrated above-market organic growth, represents an exciting opportunity for our existing investors as well as incoming Vonex shareholders.”

Superior value

Mr Spenceley said the takeover offer – which was funded from Swoop’s existing cash resources – would create significant value for Vonex and Swoop shareholders.

“We believe our offer represents superior value to the MaxoTel scheme,” he said.

“We do not support the MaxoTel scheme and do not intend to vote our Vonex stake in favour of it.”

Swoop’s existing lender Westpac (ASX: WBC) has commenced a credit approval process to provide funding in relation to the acquisition.

Board response

At the time of Swoop’s competing submission, the board of Vonex said it did not consider the bid to be superior to MaxoTel’s offer and advised shareholders to take no action.

“Swoop’s non-binding indicative proposal remains conditional and incapable of execution and there is no certainty that it will lead to a binding offer,” it said.

“We unanimously recommend Vonex shareholders vote in favour of the scheme of arrangement with MaxoTel and each director intends to vote all of the Vonex shares controlled or held by or on behalf of them in favour of the scheme in the absence of a superior proposal.”