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WebCentral shareholders approve Melbourne IT bid

WebCentral shareholders approve Melbourne IT bid

WebCentral shareholders have agreed to a $61.2 million acquisition by domain registrar, Melbourne IT. The vote puts an end to an opposing 11th hour offer by Sydney-based rival, NetRegistry.

The deal, which was initially announced in May, comprises of 40 million shares valued at $1.53 each. With shareholders poised to make between 0.63 and 0.93 per share, in addition to becoming stakeholders in the new incarnation of Melbourne IT, the WebCentral board threw its full weight behind the offer.

32,041,443 votes were recorded for the motion and 233,370 against.

At the opening address at today's extraordinary general meeting, an independent recommendation by KPMG Corporate Finance also stated the proposed takeover was fair and reasonable and in the best interests of shareholders.

Last week, NetRegistry came to the table, offering $1.65 per share to purchase the business. However, WebCentral warned its shareholders the deal was complex and conditional, providing none of the certainty of the Melbourne IT offer.

NetRegistry CEO, Larry Bloch, was unable to comment to ARN on the proposal at this time.

The news follows the release of WebCentral's full-year financial report last week, which saw revenue rise by $800,000 to $59.2 million. Operating cash flow grew to $13.6 million from $10.8 million. The company retired $2 million debt during the period, bringing remaining debt down to $3 million. Group CEO, Andrew Spicer, said some business areas had plateaued, while others grew.

"Basic hosting is slowing - it's a mature market simply because a lot of businesses already have a website," he said. "Software-as-a-service, meanwhile, is going well. We've grown enablement software 160 per cent and our hosted mailboxes 100 per cent."

Spicer said its hosted mailboxes had reached 12,000.


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