The board of Inabox Group has unanimously backed MNF Group’s improved takeover offer after raising a series of concerns in SB&G’s proposal.
In a statement to the ASX, Inabox said it raised a number of important questions about SB&G’s takeover offer that were not ‘adequately addressed.’
Inabox said the uncertainty around the improved SB&G takeover offer “far outweighs the value of the benefits promised to shareholders by SB&G and potentially exposes the company to risk of breaching its bank covenants and being unable to pay its debts when required, if the company is unable to quickly and successfully complete a capital raising.”
Specifically Inabox pointed to the volatility of equity markets and whether any bid, including the improved SB&G takeover offer, will be successful.
Furthermore, SB&G hasn’t engaged with the Inabox board to discuss its proposals prior to submitting them, and has only had one meeting with Inabox’s bank, CBA, creating further doubts that SB&G can work constructively with the board and bank to construct, negotiate and execute the series of agreements necessary for the improved SB&G takeover offer, if it was successful.
In October, publicly-listed MNF Group entered into an agreement to acquire Inabox's indirect business, which includes its wholesale and enablement businesses - Telcoinabox, iVox, Neural Networks, Mobile Service Solutions and Symmetry Networks.
The deal would see MNF Group pay between $30.3 and $33.5 million for the business units, with the wholesale business currently responsible for 500 customers.
The transaction was meant to be completed by 30 November, but a counter offer was made by a subsidiary of SB&G Group, SB&G Telecoms, for an all-cash $21.4 million offer at $0.90 per IAB share for the wholesale business, ahead of a 19 November shareholder meeting due to vote the MyNetFone bid.
SB&G Telecoms already maintains 19.9 per cent of Inabox shares.