- Vonex (VN8) shares have spiked after the company completed its acquisition of fellow telecommunications business Nextel
- The acquisition will increase the group’s annualised recurring revenue to more than $18 million
- Vonex’s consideration for the acquisition was roughly $1.57 million, consisting of $315,000 cash and 5.5 million escrowed shares
- The company has maintained a strong cash position after receiving a $541,000 research and development tax refund payment
- Vonex closed 20 per cent higher for 27 cents per share
Vonex (VN8) shares have spiked after the company completed its acquisition of fellow telecommunications business Nextel.
The company first signed a binding term sheet for the acquisition of Nextel’s business and operations in December 2020.
During the 2020 financial year, Nextel achieved EBITDA of approximately $450,000, on revenue of roughly $2 million.
Vonex’s acquisition of Nextel will increase the group’s annualised recurring revenue to more than $18 million. The acquisition will also create opportunities for cross-selling and product expansion through the small-to-medium enterprise customer base.
Vonex’s Managing Director, Matt Fahey, said that the company is looking forward to integrating Nextel’s operations into its fast-growing existing business.
“Acquiring Nextel’s well-established operations will be instantly accretive to Vonex’s customer base, carrier relationships, recurring revenue, and earnings,” he said.
“Nextel will empower Vonex to drive value for our wholesale and retail customers through new products and expertise, and it provides us with a highly capable team on the ground through whom we can capitalise on tremendous growth opportunities in the Sydney and wider NSW market,” he added.
Vonex’s consideration for the acquisition of Nextel was worth roughly $1.57 million. It consisted of $315,000 cash, as well as over 5.5 million ordinary Vonex shares, which are subject to 12 months’ voluntary escrow.
Since the majority of the consideration was made up of shares instead of cash, the company’s cash reserves have been preserved. Vonex has further maintained a strong cash position after receiving a $541,000 research and development tax refund payment.
Vonex closed 20 per cent higher for 27 cents per share at 4:10 pm AEDT.