The Vocus Group Ltd (ASX: VOC) share price has jumped after receiving a takeover offer. The Vocus share price is up 15%.
Vocus describes itself as a leading specialist of fibre and network solutions provider. It owns and operates a 30,000km of fibre network that is purpose-built and managed for business and government. It also has a number of retail brands including Dodo, iPrimus and Commander in Australia, as well as Slingshot, Orcon and Flip in New Zealand.
Takeover offer for Vocus
Vocus acknowledged recent press speculation and confirmed that it had a ‘confidential’, non-binding, indicative proposal from Macquarie Infrastructure and Real Assets (MIRA) and its managed funds to acquire the whole of Vocus.
The offered price comes to $5.50 per share. That offer is a premium of 25.5% compared to the last closing price from last week.
Vocus’ board said that the offer is subject to a number of conditions including completing satisfactory due diligence by MIRA, securing debt financing, unanimous recommendation by the Vocus board and entry into the takeover arrangement.
What is the Vocus response?
After consideration by the Vocus board and its advisers, the board has concluded that it is in the best interests of Vocus shareholders to explore the potential for a transaction with MIRA, and has granted MIRA due diligence access to enable MIRA to potentially put forward a binding proposal.
But, there’s no certainty that this will result in a binding offer for Vocus.
Vocus will update the market when there is more to announce.
Thoughts on this deal
For Macquarie Group Ltd‘s (ASX: MQG) investment fund I think it makes a lot of sense. Interest rates are incredibly low, so buying assets when money is so cheap could be smart.
Vocus does have some valuable assets and the share price hasn’t been anywhere near $5.50 for years. I’d be happy to take the money if I were a shareholder.
A similar business to re-invest the money could be Macquarie Telecom Group Ltd. (ASX: MAQ). But there are other ASX shares in the ‘infrastructure’ space I’d rather buy like Infratil Ltd (ASX: IFT) or Magellan Infrastructure Fund (Currency Hedged) (ASX: MICH).