Aussie Broadband is set to raise about $120 million to fund its intention to acquire customer bases and assets that could help propel its growth ambitions, particularly in the business market.
The company used its recent FY21 results to reveal that it would make at least one acquisition before the end of calendar year 2021.
It went into a brief trading halt yesterday before announcing a capital raising, comprising a $114 million (before costs) institutional placement and up to $10 million share purchase plan for existing shareholders.
Financial reporting overnight suggested the exercise is targeting a total raise of $120 million.
In a financial filing, Aussie Broadband said it had “received firm commitments to raise $114 million before costs via a placement of 28.5 million ordinary shares to new and existing institutional, sophisticated, and professional investors.”
“The funds will be used to support acquisitive growth by M&A, new business product and technology development, and/or increase technology development to improve network efficiency and fund the growth of fibre and network assets,” it said.
“The placement shares will represent approximately 15 percent of the issued capital of the company before the placement.”
Managing director Phillip Britt said he was “very encouraged” by the response to the capital raise.
“We greatly appreciate the backing of existing shareholders who participated in the placement and welcome new shareholders that have joined the register as part of the equity raise,” he said.
“There are promising opportunities to execute transformational acquisitions in the business segment that will complement and improve Aussie Broadband’s position in the market.
“We believe this will help us to continue delivering outstanding results for our shareholders and help the company to continue to change the telco game in Australia.”