Zeros and ones
The local IT and telecoms sector is awash with all manner of deals from large telcos to niche switch manufacturers.
As the ACCC gets set to consider the submissions it will soon receive on the proposed merger between Vodafone and Hutchison, other deals in the IT and telecommunications space continue.
Singapore Telecommunications, which owns the Optus network in Australia, announced earlier this week that it had arranged for $S1.08 billion ($1.01 billion) in credit facilities from a consortium of banks.
The Bank of Tokyo-Mitsubishi UFJ, DBS Bank, Oversea-Chinese Banking Corporation, United Overseas Bank, Calyon, Citibank and HSBC all participated. "SingTel appreciates and is pleased with the commitment and participation from its bankers. The committed facility of $S1.08 billion will meet the group's refinancing requirements for the next financial year ending March 31, 2010," said chief financial officer Jeann Low.
Although earnings from Optus represented some 30 per cent of SingTel's proportional EBITDA in the nine months to December 31, Australian lenders were notably absent despite SingTel's A and Aa ratings from Standard & Poor's and Moody's respectively. SingTel has a net debt gearing ratio of approximately 25 per cent.
Telecommunications investor Cape Range Wireless has meanwhile announced a $1 million capital raising, underwritten to $500,000 by Melbourne-based investment house Capital 8 Research. Private investor William Tien has pledged 27 per cent of the money raised.
Cape Range was taken over by director Faldi Ismail in March of last year after founder Ronald Wise left the board. Wise, a prominent Western Australian entrepreneur, had built the company into a vehicle that owned stakes in telecommunications groups in Bangladesh and Malaysia, but the company entered into administration in 2006. Bryan Hughes and Chris Munday of Pitcher Partners were appointed administrators in October of that year after debts tallied up to $6.4 million.
The company still holds its telecommunications investments, but now has a sideline in Indonesian Coal. Perth deal maker Ismail is also associated with NSL Health, another improbably-named resources investor that expanded out of the staid world of dental technology into exciting iron ore projects in India.
On March 18, NSL also announced a share purchase plan to raise up to approximately $500,000. Corporate advisory and accounting firm FJH Solutions is advisor to both Cape Range and NSL.
Finally in information technology, digital services business Hyro has sold its IT infrastructure solutions business Synergy Plus to listed technology investor ComputerCorp for $9.3 million payable in cash over three years.
Hyro was last featured in this column when a rumour was circulating about a possible acquisition (A tech market test, February 18). Hyro was forced to restructure its operations after seeing its shares drop from 26 cents when it acquired Synergy, to less than 2 cents today.
Hyro's debt woes could have been worse however. Last year Hyro negotiated with Lehman Brothers to restructure its debt into a $20 million convertible note held by Lehman's Asian arm in exchange for $1.2 million in cash and 17 per cent of Hyro's equity. Had this not been transacted then it is likely that Hyro would have gone down with the investment bank's collapse.
ComputerCorp is timing its acquisition of Synergy Plus and S Central, a private Melbourne-based infrastructure and hosing company, with a $5 million capital raising. Timing of the raising, which will take place through a $3.8 million rights offer and a $1.2 million private placement of S Central shareholders, is yet to be announced. ComputerCorp's deal-making chairman Domenic Martino – the former chief executive of Deloitte and the founding director of Sydney Gas and Blue Energy – intends to underwrite the rights offer.
Wrapping up other deals in the sector, Byte Power Group has announced two convertible note transactions raising $2.25 million in cash and Hills Industries has bought a 51 per cent stake in the unlisted UHS Systems, which sells a range of security communications products and services.
Industry watchers are also eagerly awaiting what is hoped to be Australia's first IT listing in quite some time. Boutique Sydney corporate advisory firm Novus Capital is sponsoring the $3 million initial public offer of Azurn International, a Melbourne conferencing switch maker.
Novus is entitled to a lead management and broker fee of $110,000 plus a fee equivalent to 6 per cent of all funds raised by the firm. Deacons will be picking up $120,000 in fees from the issue, Moore Stephens will net $50,000 in auditing fees and Middletons will collect $10,000 for its patent attorney's report.
Last year Novus, founded by former Bridges Financial executive Wayne Gooley, acted as broker to a placement for digital media company Swish Group. Novus owns 50 per cent of the web-based Financial News Network.
Singapore Telecommunications, which owns the Optus network in Australia, announced earlier this week that it had arranged for $S1.08 billion ($1.01 billion) in credit facilities from a consortium of banks.
The Bank of Tokyo-Mitsubishi UFJ, DBS Bank, Oversea-Chinese Banking Corporation, United Overseas Bank, Calyon, Citibank and HSBC all participated. "SingTel appreciates and is pleased with the commitment and participation from its bankers. The committed facility of $S1.08 billion will meet the group's refinancing requirements for the next financial year ending March 31, 2010," said chief financial officer Jeann Low.
Although earnings from Optus represented some 30 per cent of SingTel's proportional EBITDA in the nine months to December 31, Australian lenders were notably absent despite SingTel's A and Aa ratings from Standard & Poor's and Moody's respectively. SingTel has a net debt gearing ratio of approximately 25 per cent.
Telecommunications investor Cape Range Wireless has meanwhile announced a $1 million capital raising, underwritten to $500,000 by Melbourne-based investment house Capital 8 Research. Private investor William Tien has pledged 27 per cent of the money raised.
Cape Range was taken over by director Faldi Ismail in March of last year after founder Ronald Wise left the board. Wise, a prominent Western Australian entrepreneur, had built the company into a vehicle that owned stakes in telecommunications groups in Bangladesh and Malaysia, but the company entered into administration in 2006. Bryan Hughes and Chris Munday of Pitcher Partners were appointed administrators in October of that year after debts tallied up to $6.4 million.
The company still holds its telecommunications investments, but now has a sideline in Indonesian Coal. Perth deal maker Ismail is also associated with NSL Health, another improbably-named resources investor that expanded out of the staid world of dental technology into exciting iron ore projects in India.
On March 18, NSL also announced a share purchase plan to raise up to approximately $500,000. Corporate advisory and accounting firm FJH Solutions is advisor to both Cape Range and NSL.
Finally in information technology, digital services business Hyro has sold its IT infrastructure solutions business Synergy Plus to listed technology investor ComputerCorp for $9.3 million payable in cash over three years.
Hyro was last featured in this column when a rumour was circulating about a possible acquisition (A tech market test, February 18). Hyro was forced to restructure its operations after seeing its shares drop from 26 cents when it acquired Synergy, to less than 2 cents today.
Hyro's debt woes could have been worse however. Last year Hyro negotiated with Lehman Brothers to restructure its debt into a $20 million convertible note held by Lehman's Asian arm in exchange for $1.2 million in cash and 17 per cent of Hyro's equity. Had this not been transacted then it is likely that Hyro would have gone down with the investment bank's collapse.
ComputerCorp is timing its acquisition of Synergy Plus and S Central, a private Melbourne-based infrastructure and hosing company, with a $5 million capital raising. Timing of the raising, which will take place through a $3.8 million rights offer and a $1.2 million private placement of S Central shareholders, is yet to be announced. ComputerCorp's deal-making chairman Domenic Martino – the former chief executive of Deloitte and the founding director of Sydney Gas and Blue Energy – intends to underwrite the rights offer.
Wrapping up other deals in the sector, Byte Power Group has announced two convertible note transactions raising $2.25 million in cash and Hills Industries has bought a 51 per cent stake in the unlisted UHS Systems, which sells a range of security communications products and services.
Industry watchers are also eagerly awaiting what is hoped to be Australia's first IT listing in quite some time. Boutique Sydney corporate advisory firm Novus Capital is sponsoring the $3 million initial public offer of Azurn International, a Melbourne conferencing switch maker.
Novus is entitled to a lead management and broker fee of $110,000 plus a fee equivalent to 6 per cent of all funds raised by the firm. Deacons will be picking up $120,000 in fees from the issue, Moore Stephens will net $50,000 in auditing fees and Middletons will collect $10,000 for its patent attorney's report.
Last year Novus, founded by former Bridges Financial executive Wayne Gooley, acted as broker to a placement for digital media company Swish Group. Novus owns 50 per cent of the web-based Financial News Network.
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