Online classifieds group, Mitula Group Limited (ASX: MUA) lately announced that LIFULL Co., Ltd would continue to acquire 100% shares in Mitula at a cash consideration of A$0.80 per share and the cash top up mechanism will not be applicable.
This comes after the terms of cash top up mechanism were not fulfilled as LIFULL shares traded above $0.80 for each of the 10 trading days up to and including Friday, 7 December 2018. The terms of cash top amount was that if the value implied by the LIFULL share price is less than A$0.80 per share, an additional amount of money, ‘Cash Top Up Amount’, will be added to the scrip consideration under the scheme up to a maximum of A$10 million. The purpose of this mechanism was to provide additional downside protection for the scrip consideration payable under the Scheme.
Let’s take a recap of Scheme of arrangement between Mitula Group and LIFULL Co., Ltd:
In May this year, Mitula Group and LIFULL Co., Ltd entered into a scheme implementation deed under which LIFULL agreed to acquire all outstanding shares of ASX listed Mitula Group at a cash and share consideration. Moreover, it has been agreed that post acquisition, Mitula will become the wholly-owned subsidiary of LIFULL Co., Ltd.
In discharge of purchase consideration, LIFULL stated that any Mitula shareholder listed in the final shareholder register on the record date will receive cash consideration of A$0.80 per share up to 20,000 shares and if the shareholder has more than 20,000 shares he will be entitled to receive the balance in stock consideration. The bidder LIFULL has also given an alternative to Mitula shareholders under which shareholders may elect to receive the stock consideration for all of their own Mitula Shares.
Mitula told that Scheme shareholders who do not make an All Scrip Election will be entitled to receive purchase consideration in combination of cash and shares. It includes $0.80 cash per Scheme Share for the first 20,000 of their Scheme Shares that were held as at Wednesday 24 October 2018 and 0.0753 New LIFULL Shares for each remaining scheme share.
It is worth noting that LIFULL Co., Ltd is a Japan-based company, engaged into diversified businesses including dissemination of real-estate related information. The company specializes in providing real estate leasing- and sales-related information through portal Website named HOME'S. It also runs website production business, advertising agency, system development and provision of ASP services to real estate companies. On the other hand, Miltula Group Limited, founded in 2009, owns and operates property portals and vertical search and transaction sites across employment, motoring, fashion and other domains. It has a network spread across 54 countries and the group seems to add value to LIFULL portfolio.
In today’s trading session (December 13, 2018), Mitula’s stock price touched the 52-week high of $0.800, and then slipped slightly to $0.795 (1:30 PM AEST). Primarily, Victoria’s Supreme Court has given a green signal to the above acquisition, as at December 13, 2018.
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