BigAir takes a step closer to $95 million Superloop merger

BigAir takes a step closer to $95 million Superloop merger

The companies face one more hurdle before they can combine forces in proposed acquisition agreement

Jason Ashton - CEO, BigAir

Jason Ashton - CEO, BigAir

Business-focused IT provider, BigAir (ASX:BGL), has taken a step closer to joining forces with telecommunications provider, Superloop (SLC), after the company’s shareholders voted overwhelmingly in favour of the proposed acquisition.

The publicly-listed managed services, network infrastructure and cloud-based solutions provider said that 99.45 per cent of shareholder votes cast at a meeting in Sydney on 7 December were in favour of the deal.

The proposed merger, first announced in September, sees Superloop acquire 100 per cent of BigAir’s shares in a scheme of arrangement.

The potential deal will see the two companies combine to become a full-service telecommunications and managed services entity, with the capabilities to provide end-to-end voice, data, cloud, and managed IT services – all while using its own fibre-optic networks within Australia and, later, in Singapore and Hong Kong.

The cash component of the consideration for the proposed acquisition is being funded in part by a scrip issued to existing BigAir shareholders, with the cash consideration capped at $95 million, to be funded by a combination of the share placement and a new $75 million debt facility.

Superloop, which was founded by PIPE Networks co-founder, Bevan Slattery, who is also the company’s CEO and chairman, was established in 2014, and provides interconnection services in the Asia Pacific region.

It owns and operates over 300km of fibre networks in Australia and Singapore, connecting over 48 of the region’s key datacentres.

On 2 December, the company announced it had completed the installation and testing of the first 110km backbone fibre cable network in Hong Kong.

“The Hong Kong network, when combined with the existing Singapore and Australian networks, uniquely positions Superloop as the only provider with significant metropolitan fibre infrastructure across these three major markets,” Slattery said at the time.

Under the terms of the acquisition, BigAir, which acquired Oriel Technologies in November 2014, is set to assist Superloop in its ambition to become the region’s leading independent provider of connectivity services.

“The acquisition of BigAir will allow us to leverage our fibre network plus provide us with new wireless capabilities to deliver low cost gigabit connectivity,” Slattery said in September.

The agreement will see Superloop carry BigAir’s wireless and “fibre extender” capability, and build a low-cost access alternative for Gigabit+ speeds.

Additionally, BigAir’s managed service offerings will be restructured and rebranded to create a “fully integrated and focused” managed service provider business with a “clear statement” on market position and product offerings.

BigAir, which acquired managed services security solutions provider, CyberHound, for $7 million in July, still has one more hurdle to clear before it can go ahead with the deal.

The company is seeking orders from the Federal Court of Australia for the approval of the share scheme needed to complete the merger.

If the Federal Court approves the scheme, BigAir expects to lodge the court orders with the Australian Securities and Investments Commission on the same day, so that the scheme can become legally effective by 9 December, with the implementation date of the scheme set for 21 December.

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Tags bigairfibreBevan SlatterySuperloop


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