Webcentral To Stay Aussie Owned
In a surprise turnaround, Melbourne-based Webcentral looks set to remain in Australian hands, with 5G Networks now the favoured offer to take over the company in an off-market bid.
Directors of the ASX-listed digital services company withdrew their recommendation for shareholders to vote for a rival bid from American giant Web.com, instead throwing their weight behind the 5G Networks (5GN) offer, which would see Webcentral shareholders trade in their shares at a 12 to one ratio for 5G Networks shares.
5GN will also remove Webcentral’s $47.6 million debt burden.
In a letter to Webcentral investors, 5GN managing director Joe Demase said the company is exactly what 5GN has been looking for.
“We are excited by the growth potential we see in Webcentral and will leverage our experience and expertise to add significant value.
“The domain and hosting business are complementary to the 5GN product range, which unlocks significant opportunities to collaborate, package and integrate our solutions to improve the service experience for customers and drive product profitability,” he said.
Webcentral this year plunged from a $1.6 million profit to an $18 million loss.