Thankfully, we are seeing another positive day for the S&P/ASX 200 Index (ASX: XJO) this Wednesday. At the time of writing, the ASX 200 has risen by a healthy 0.27%. As such, perhaps investors in the Aussie Broadband Ltd (ASX: ABB) share price will be disappointed that the ASX 200 telco share is sitting this one out.
Yep, just before market open this morning, Aussie Broadband released an ASX announcement declaring its shares to be in a trading halt.
It soon became pretty clear why.
Aussie Broadband has just announced that its fellow ASX telco Symbio Ltd (ASX: SYM) has accepted Aussie's takeover offer and entered into a scheme or arrangement. As such, Symbio now looks set to be acquired in full by Aussie Broadband.
On Monday, we went through the history of Aussie Broadband's courtship of Symbio. The company has been locked in a tussle to buy out Symbio for over a month. Aussie came out on top over rival telco Superloop Ltd (ASX: SLC), which had made competing offers for Symbio.
But Aussie Broadband's offer of $2.26 per share in cash, and 0.192 Aussie Broadband shares for every Symbio share in scrip has evidently won the day. This valued Symbio at $3.01 per share.
At the time of writing, the Symbio share price is up 4% to $2.86.
Image source: Getty Images
How would the Symbio acquisition benefit the Aussie Broadband share price?
This offer has been accepted and universally recommended by Symbio's board, as revealed in the company's own ASX release this Wednesday. That's of course in the absence of any superior offer emerging. As well as after an independent expert report publishes its findings.
The scheme will also require court approval if it is to go ahead. As well as the approval of Symbio's shareholders, of course.
If all goes to plan, both companies expect the acquisition to be completed in February next year.
Here's some of what Aussie Broadband plans for a post-acquisition future:
The Symbio business is highly complementary to the existing Aussie Broadband business and strategy, and the combined entity will be attractively positioned as a scale, diversified modern voice, business and unified communications player in Australia.
The acquisition provides Aussie Broadband the following benefits:
- Accelerates significant growth in Wholesale and Enterprise & Government
segments- Diversification creating new growth opportunities
- Increased scale and strengthened financial profile
- Highly complementary businesses with operational and cost efficiency
opportunities- Access to new capabilities
Aussie Broadband's current intention is to operate Symbio predominantly as a standalone
business in the near-term following acquisition, with the businesses to be integrated and
efficiencies realised over time.
Aussie Broadband shareholders will now have to wait and see if this acquisition gets regulatory and shareholder approval from both sides.
The Aussie Broadband share price remains up by a pleasing 50.77% in 2023 to date, and by 56.8% over the past 12 months.
