IPH And Xenith Enters The Scheme Implementation Deed To Acquire Xenith

IPH And Xenith Enters The Scheme Implementation Deed To Acquire Xenith

IPH Limited (ASX: IPH) is an ASX listed company working in the industrial sector. It Is a holding company of four high-quality businesses which are specialised in the area of IP services and products. The company has a team of approximately 600 employees in various countries including New Zealand, China, Australia, Hong Kong, etc. The company has a client base of prestigious clients like Fortune Global 500 companies, professional services firms, public sector research organisations, etc.

On 12th April 2019, IPH announced that it has entered a binding scheme implementation deed with Xenith IP Group Limited. Under the scheme, IPH has proposed to acquire 100% stake in the Xenith for a combination of cash and IPH shares. The cash component of the scheme will be funded by IPH’s existing debt facilities and the share component will be issued at a price of $6.90 per IPH share.

Under the terms and conditions, the shareholders of the Xenith will be entitled to receive standard consideration of $1.28 in cash and 0.1261 IPH shares for every Xenith share which is valued at $2.15 per Xenith share based on IPH’s closing price on 5th April 2019 of $6.90 per share. The total value of consideration payable by IPH is approximately $154 million.

This value of A$2.15 per Xenith share represents a 12% premium to the Xenith closing price of $1.925 on 5th April 2019. It is also at a premium of 42% to the mid-point of the Xenith valuation of $1.515 which was conducted for the purposes of the proposed merger of Xenith with QANTM Intellectual Property Limited. The scheme of the valuation considers a fully diluted market capitalisation of Xenith to be approximately $191.7 million with approximately $206.8 million of enterprise value.

The shareholders of Xenith may also elect to receive maximum cash consideration per Xenith share under the “Mix and Match” facility. This provides flexibility in addressing the particular preferences of individual shareholders. However, this facility is subject to scale-back mechanism under which IPH will pay maximum cash consideration of approximately $91.4 million and issue a maximum number of shares of approximately 15.6 million.

This move by IPH was not a surprise as earlier on 12th March 2019, IPH had already introduced its proposal to acquire the full stake in Xenith and further on 8th April 2019, revised the proposal. But under the scheme implementation deed between Xenith and QANTM Intellectual Property Limited, QANTM must be notified and was given three business days to match the terms of the Updated IPH Proposal of which the last date was 11th April 2019. QANTM declines to make any updated proposal till the deadline which got expired yesterday. This expiration of the period led to further development in the IPH’s proposal to acquire Xenith.

Sponsored ad by Kalkine

The market capitalisation of IPH stands at A$1.37 billion. On the technical front, the stock price increased by 2.014% and traded at A$7.090 on ASX after making the intraday high of A$7.100 as of 12th April 2019 (AEST: 2:17 PM). In the last six months, the stock has given a good return of 25% while the YTD return stands at 28.23%.


Disclaimer

This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.

Facebook Comments

Join Our Discussion

Start discussion with value Investors for ASX Stock Market Investment and Opinion.


6 Cannabis Stocks under Investor’s Limelight…

Cannabis companies that sell both medicinal weed and recreational pot. Marijuana stocks to look at. Marijuana mergers and acquisitions. Dispensary data analytics. Upcoming marijuana IPO’s Those phrases have become increasingly common as marijuana legalization spreads.

Global spending on legal cannabis is expected to grow 230% to $32 billion in 2020 as compared to $9.5 in 2017, according to Arcview Market Research and BDS Analytics. As of June 29, 2018 the United States Marijuana Index, despite a lot of uncertainty around regulations, has over the past 1 year gained 71.49%, as compared to about 12% gain seen by the S&P 500.

Click here for your FREE Report

LEAVE A REPLY

Please enter your comment!
Please enter your name here