Opticom (OPC)

Hey guys,

I also posted this in the OPC forum as I am an OPC (but not a UWL) shareholder but there’s no chat there so I figured I’d post it here too as I may become a shareholder of UWL if the reported proposed takeover is ultimately successful - so I’m interested to hear your views.

Street Talk is reporting an imminent takeover offer by Uniti Wireless to acquire OPC in a cash and scrip bid of $5.20 per share. OPC has a larger market cap than UWL and it’s share price was $5.02 at Friday’s close. So there is no real takeover premium to speak of which as a holder of OPC I’m not thrilled about as my initial reaction is I’d prefer to continue holding my OPC shares.

I have followed the UWL story from afar and know they have good insto backing and it sounds like they’re executing a decent roll up strategy. But i’ve never looked at it closely so I don’t have a firm view on the scrip component yet.

AFR’s Street Talk is also reporting a $270m cap raise at a 6% discount to UWL’s last close (final terms tbc) to part fund the OPC takeover. If accurate, that implies the bid will be split more or less 50/50 cash and scrip. In that case OPC shareholders will end up owning approximately 25% of the combined business. In these circumstances (relinquishment of board and economic control) I would expect the minimum customary 30% takeover premium. But my piddly shareholding won’t have any impact on a vote so it’ll really come down to what OPC’s founders want to do who still own a big chunk of the business.

cheers