Vysarn Limited Seeks Shareholder Approval for Issuance of Up to 4.4 Million Deferred Shares in NWG Enterprises Acquisition

Shareholder Approval Now Required for Deferred Consideration Shares

Vysarn Limited has amended its previous announcement regarding the NWG Enterprises acquisition, now requiring shareholder approval for the issuance of deferred consideration shares. The company will hold a general meeting on or before 4 September 2026 to obtain shareholder consent in accordance with ASX Listing Rule 7.1. This is a change from the original announcement dated 3 June 2026, which did not include this approval condition.

This shareholder vote is a crucial step, allowing Vysarn shareholders to review and approve the proposed share issuance. Until approval is granted, the share issue cannot proceed unconditionally. This regulatory step ensures transparency and gives shareholders a formal role in decisions affecting the company’s capital structure.

Deferred Share Issuance Linked to EBIT Earn-Out Targets

The issuance of up to 4.4 million consideration shares depends on NewGround achieving specified EBIT targets over a 12-month earn-out period. This earn-out mechanism means that the full share allocation may not be issued if performance targets are unmet. Such structures align seller and acquirer interests by tying part of the acquisition consideration to post-acquisition financial results.

The estimated AUD 3.3 million value of the consideration shares reflects the acquisition cost contingent on meeting these earn-out conditions. This performance-based framework mitigates risk for Vysarn shareholders by potentially reducing share issuance if NewGround underperforms relative to expectations.

Proposed Share Issue Date and Security Details

The proposed issue date for the consideration shares is 15 July 2027, subject to shareholder approval and NewGround achieving EBIT targets. The shares will be ordinary fully paid shares in the existing class quoted on the ASX under code VYS. They will rank equally with existing shares, carrying identical voting rights and dividend entitlements.

Issuing shares from the existing class simplifies the listing process and maintains consistency with Vysarn’s capital structure. No options or performance rights will attach to these shares. The approximately 10-month period between shareholder approval and the issue date allows assessment of the earn-out performance.

Acquisition of NWG Enterprises Pty Ltd

Vysarn is acquiring 100% of NWG Enterprises Pty Ltd, with the deferred consideration shares forming part of the total acquisition consideration. The full purchase price and complete transaction terms were not disclosed in this announcement. For detailed information, investors should refer to Vysarn’s announcement dated 2 June 2026.

This acquisition represents a significant transaction for Vysarn. The use of deferred, earn-out based scrip consideration preserves cash and offers sellers equity participation in the combined business’s future performance, reflecting confidence in value creation post-acquisition.

Voluntary 12-Month Escrow on Consideration Shares

The 4.4 million consideration shares will be subject to a 12-month voluntary escrow starting from the issue date of 15 July 2027, preventing sale or transfer until approximately 15 July 2028. This lock-up is standard in acquisitions, demonstrating sellers’ commitment to the combined entity.

The escrow protects Vysarn shareholders by ensuring sellers remain invested for a minimum period post-acquisition, aligning interests and signaling confidence in the acquisition strategy. Secondary sales during escrow will comply with Corporations Act provisions to prevent non-compliant transactions.

Compliance with ASX Listing Rules and Regulatory Framework

Shareholder approval for the share issuance is sought under ASX Listing Rule 7.1, with no relief or waiver requested. The general meeting on or before 4 September 2026 will address this requirement. No related parties under Listing Rule 10.11 are involved, so no additional approvals are necessary.

The consideration shares will not be restricted securities post-escrow, allowing free trading on the ASX thereafter. The transaction complies fully with ASX and Corporations Act regulations, ensuring investor protections.

No Changes to Dividend or Distribution Policy

Vysarn confirmed that the proposed share issuance will not affect its existing dividend or distribution policy. This indicates confidence in the combined entity’s cash flow and maintains stability in capital return strategies for shareholders.

While specific dividend details were not disclosed, maintaining the current policy provides certainty for investors factoring dividends into their investment decisions.

ASX Share Registry and Associated Fees

The consideration shares will be issued through Vysarn’s share registry, incurring standard ASX share issue fees. The exact fee amounts were not disclosed. No underwriter or lead manager is involved, as this is a corporate transaction rather than a public capital raise.

Issuing shares via the company’s registry ensures accurate record-keeping and compliance with ASX requirements, minimizing transaction costs compared to a public offering.

Timeline and Next Steps for Investors

The key upcoming event is the general meeting on or before 4 September 2026, where shareholders will vote on the share issuance approval. Following approval, the acquisition process will advance toward completion with the proposed share issue on 15 July 2027.

Investors should monitor announcements on NewGround’s financial performance during the 12-month earn-out, which will determine the final share allocation. After issuance, the 12-month escrow will expire around 15 July 2028, enabling sellers to trade their shares. Vysarn will disclose any significant developments in line with ASX Listing Rules.