The Australian Federal Court has approved NetComm Wireless’ shareholder vote on a AU$161 million acquisition by Casa Systems, with the company also announcing that its independent assessor has recommended the transaction be approved.
“The independent expert has assessed the full underlying value of NetComm at between AU$0.85 and AU$1.08 per NetComm share. The scheme consideration of AU$1.10 cash per share is above this range,” the Australian networking equipment vendor, which is a supplier for the National Broadband Network (NBN) company, said.
The vote is set to take place on June 7 at 10am AEST, with the second court date for approval of the scheme scheduled for June 12. The scheme would then be implemented on June 25.
“In our opinion, the scheme is fair and reasonable and in the best interests of NetComm shareholders in the absence of a superior proposal,” the independent expert added in its report.
“The scheme consideration of AU$1.10 cash per share slightly exceeds the top end of our assessed value range for NetComm shares on a 100% controlling interest basis. Thus, in our view, NetComm shareholders are being paid an appropriate price to compensate them for the fact that control of NetComm will pass to Casa Systems if the scheme is approved.”
NetComm’s directors are also maintaining their unanimous recommendation that the scheme be approved.
“NetComm benefits from Casa Systems’ complementary product set, engineering expertise, and sales infrastructure in several markets,” the company said on Friday.
“NetComm brings its global development of fixed broadband and IIoT products, fixed-wireless, and distribution point broadband solutions, and service delivery approach.”
NetComm had first announced the potential acquisition in February, which would see the company become a wholly owned subsidiary of Casa Systems.
Casa Systems chair and CEO Jerry Guo at the time said the purchase would allow his company to add fixed-wireless solutions to its portfolio, as well as diversify its revenue streams and geography.
As well as supplying to the NBN, NetComm also produces industrial Internet of Things (IIoT) devices, delivers its fixed-wireless technology to AT&T in the United States, and has worked with BT on fibre-to-the-curb technology.
For the first half of FY19, NetComm announced revenue of AU$94.3 million, up 6.5% on last year, and earnings before interest, tax, depreciation, and amortisation (EBITDA) of AU$8.3 million, a drop of AU$0.9 million compared to the same period last year.
The company’s full-year FY18 EBITDA was AU$20.5 million on revenue of AU$182 million.
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