MNF sweetens Inabox deal to fend off rival acquisition bids

MNF Group has sweetened its offer to acquire Inabox after a rival bid for the company was put forward last week.

The company formerly known as MyNetFone raised its offer to buy Inabox's remaining indirect business to $34.5 million on a debt-free basis to be 100 percent paid upon completion with no earn-out incentives.

Under the previous offer, MNF would have received $30.5 million in cash plus up to $3 million in earn out bonuses, valuing Inabox's shares at roughly 80 cents each.

The revised offer comes a week after SB&G Telecoms, which already owns a 19.9 percent stake in Inabox, offered to buy the company's shares for 90 cents each.

With the new deal on the table, all other conditions required to complete the acquisition have been waived other than shareholder approval. In addition, Inabox would need to raise $3 million to cover cancellation charges if the MNF offer isn't approved.

Inabox's directors unanimously recommended shareholders approve MNF's revised offer, saying it would provide shareholders with greater certainty and a higher return than SB&G's offers. Inabox would also have $21.5 million in surplus cash, which it already indicated would mostly be handed back to shareholders.

Inabox shareholders will vote whether to approve the MNF acquisition on 7 December.

MNF made its bid for Inabox public last month after the latter had already sold off its direct business to 5G Networks for $5.7 million, which consisted of managed IT, hosting and communications. The remaining indirect business is Inabox's largest source of revenue, accounting for $45 million last financial year. The indirect business is comprised of wholesale telco services and enablement such as networks, systems, operational support, billing services and software development.

Inabox's shares had lost close to half their value following an acquisition that went south in November last year. The company's shares were trading at 50 cents each before MNF made its offer to buy the company.