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On 5 February 2019, LiveTiles Limited (ASX:LVT), a company belonging to the information technology sector and is engaged in the development and sale of business software in Australia and overseas, gave an investor presentation where it highlighted about the acquisition of Wizdom and equity capital raising.
The presentation highlighted that LVT has signed an agreement to acquire a highly complementary and fast-growing software business Wizdom with a strong European footprint. Wizdom is a leading âplug and playâ, Microsoft-aligned digital workplace software business with 243 SaaS customers and an annualized recurring revenue (ARR) of $8.0 million as at 31 December 2018 and a positive EBITDA.Â
The maximum total purchase price to acquire Wizdom is $48 million which is equivalent to â¬30 million. The upfront purchase price is $28 million where $9 million will be in cash and $19 million will be in the form of stock and a maximum of $19.6 million will be paid as earn-out.
On 5 February 2019, LVT confirmed the successful completion of share placement to sophisticated and professional investors. Under the share placement, LVT successfully raised $15.3 million by issuing 45,000,000 fully paid ordinary shares at $0.34 per share. The revenue generated through placement will be used to fund the upfront cash purchase price as well as for working capital purposes. Citigroup Global Markets Australia Pty Limited (Citi) was the lead manager and bookrunner to the Placement.
The settlement of new shares issued under the Placement will be on Friday, 8 February 2019. The allotment and the normal trading of new shares under placement will commence from Monday, 11 February 2019.
By the end of the December quarter on 31 December 2018, there was a net cash outflow of A$9.633 million from the operating activities of the company. Here, the main reason for cash outflow was due to the payment made for the advertising and marketing, staff cost as well as the administration and the corporate cost. The company used net cash of A$0.104 million from the investing activities of the company. The company used net cash of A$0.054 million from the financing activities of the company. By the end of Q2 of FY2019, LiveTiles Limited had net cash and cash equivalent worth A$22.457 million.
The securities of LVT were placed under the trading halt on 5 February 2019 before the market got opened, pending the release of an announcement pertaining acquisition and capital raising. The halt got lifted today on 6 February 2019. The shares of LVT are trading at A$0.375, down by 5.063% as at 12:46PM AEST, 6 February 2019.
Since the inception of LVT on ASX, the stock has generated a positive performance of 97.50%. However, in last one year, the stock has given a negative return of 18.56%.The stock has a market capitalization of A$220.54 million and approximately 558.34 million outstanding shares.
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