Australia’s No 4 telco Vocus has ended talks with its two suitors, KKR and Affinity Equity Partners, both of which had put forward $2.2 billion bids for the Australian company, intending to jazz it up a bit before reselling at a handsome profit.
After conducting due diligence, both private equity outfits had said they were “unable to support a transaction on terms acceptable to the board,” Vocus told the ASX yesterday.
Vocus shares subsequently plunged as much as 25 percent on the ASX and closed the day at $2.71, down 0.51c, or 15.8 percent.
KKR in June had made an “indicative” offer of A$3.50 a share in cash, which was later matched by Affinity.
The Vocus board, announcing the departure of Affinity and KKR, stressed that it had made it clear at the time of the due diligence deals that there was no certainty that an acceptable offer would eventuate.
It added: “The board is looking forward to working with management to deliver improved returns for shareholders over the medium and long-term future.
“An important factor in the board’ s determination to conclude the sale process is the company’s FY18 outlook, which forecasts further revenue growth to between $1.9bn and $2bn and underlying EBITDA growth to between $370m and $390m.”
