Qld govt fund bids $494m in swoop on Superloop

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Qld govt fund bids $494m in swoop on Superloop

Could de-list Bevan Slattery's Megaport spin-out.

No-one could accuse Bevan Slattery of not being able to spin-up a compelling transaction target in the form of specialist ISP and connectivity provider Superloop.

The local internet and telco stalwart’s latest venture (though he's now just on the board as a director) has been swooped upon by government-owned Queensland Investment Corporation (QIC) that’s lobbed a $493.3 million offer on the table for Superloop as NBN related horse trading intensifies.

The deal would add to QIC’s infrastructure portfolio. The fund currently cites around $85 billion in funds under management.

The bid reflects an increasing appetite for sovereign wealth funds to selectively buy into tech-infrastructure as the Australian economy continues to digitise.

The offer, speculated on for around a week, was made public by Superloop on Friday morning with the infrastructure provider stating the latest price offered at $1.95 a share, up from a previous non-binding unsolicited offer of $1.95 per share at the end of last month.

The proposal from QIC is for either all cash or a combination of cash and scrip.

Superloop shares have been on a romp since mid-April, shooting from $1.46 on the 15th of that month to hit more than $1.90 in morning trading on Friday after closing at $1.81 on Thursday.

However its shares have traded as high as $2.49 in June 2018 and reached a previous peak September 2016.

In March Superloop completed a $30 million equity raising to fund development plans.

If completed, the deal would take Superloop off the ASX reflecting a broader trend for big funds to shield their buys from speculation and volatility endemic in the telco sector.

Listed in 2015, Superloop was spun out of Slatterys’ other interconnection venture Megaport.

But it’s not yet clear whether the deal will complete, with Superloop telling the ASX it wants to give QIC a three week due diligence period.

"The board of Superloop, together with its advisers, have undertaken a careful review of the revised indicative proposal and determined that it is in the best interests of Superloop shareholders to grant QIC a period of approximately three weeks to conduct due diligence on an exclusive basis,” the ASX notice said.

The statement added that this was “in order to establish whether an acceptable binding transaction can be agreed."

“There is no certainty the Revised Indicative Proposal will result in a transaction.

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