EuNetworks Group

[ryan]

Columbia Moves To Take euNetworks Private
November 25th, 2014 by Rob Powell

While I was traveling last week, the rumors of an M&A deal surrounding euNetworks became more than rumors. They company’s largest shareholder, Columbia Capital, has launched an effort to buy the rest of the company and take it private, looking to bring the independent western European fiber footprint all the way under its umbrella.

They’ve been moving quickly too since their interest was mentioned less than two weeks ago. As of Friday, via a holding company EUN Holdings, LLP, Columbia had acquired another 17.32% of euNetworks outstanding stock, giving it some 58.93%. euNetworks’ board has appointed Canaccord Genuity Singapore Pte. Ltd. to advise its independent directors on the offer, advising shareholders to wait for the board to consider the offer.

The offer of S$1.16 per share was obviously at a substantial premium to the trading price, which jumped 85% on the news over in Singapore where it is traded. I haven’t done the math yet myself as I don’t follow the stock in Singapore, but I’m told that works out to something like 12 times EBITDA, give or take.

So what does this mean? For the folks at euNetworks, it might mean a change in ownership but probably not a big shift in operational direction. The public listing in Singapore has been more of a burden than blessing anyway in recent years, I doubt they would miss that piece of the puzzle. And it probably pushes back the potential for a buyout by someone like Zayo, at least in the near term. In other words, it would probably simplify the equation in key ways.

Actually, by taking the company private, Columbia Capital would make it easier to fund euNetworks’ growth, particularly when it comes to potential further M&A moves. euNetworks bought Fibrelac a few months back, moving up into the Alps in a small but interesting move. With full control, Columbia might hit the accelerator on other such plans.

The company has long had ambitions to use its footprint as a platform for further consolidation of European fiber assets, but it’s not as easy a process in Europe as we have seen in the USA. International borders in Europe may be lower hurdles than elsewhere in the world, but they’re far bigger than between US states when it comes to things like local market knowledge, language, and culture. Not many competitive providers in Europe have the sort of experience necessary to do it, but euNetworks has proven it can.

On the other hand, Columbia’s move might prompt the board to seek other bids, and one from Zayo, Level 3, or perhaps Interoute or Colt could easily materialize. As a major shareholder, Columbia clearly has the inside track, but a strategic buyer would have more synergies at hand to bolster a bid. And of course, Columbia Capital owns a chunk of Zayo too.

http://www.telecomramblings.com/2014/11/...s-private/

[ryan]

Euro Telco M&A Simmers On
December 1st, 2014 by Rob Powell

Seems like everything is in play these days when it comes to telecommunications consolidation in Europe. While Americans were all off on a turkey break, across the Atlantic several soap operas continued.

With BT looking at both EE and O2, we’ve seen a quick response from the other big mobile operator in the UK. Vodafone is apparently taking a hard look at Liberty Global, whose cable assets would give the company deeper terrestrial assets across Europe but especially in the UK where they would combine interestingly with the former C&W assets.

Teliasonera has hit a major snag in the planned boost of its Norwegian mobile market via the acquisition of Tele2’s business there. Regulators apparently don’t like the idea of a duopoly much at all. They haven’t officially ruled against it, which leaves some wiggle room for further concessions. But their position doesn’t sound terribly accomodating.

Altice has raised its bid to buy Portugal Telecom from Brazil’s Oi. Their initial €7B bid was one-upped by a €7.07B bid from private equity groups. The new bid by Altice raises the stakes to €7.4B, a half billion of which is conditional upon revenue target. Altice and Oi have now entered exclusive negotiations, suggesting that was probably enough.

And Columbia Capital continued to move ahead with its effort to take euNetworks private. They’ve filed the formal offer document as we wait for a response from euNetworks and its advisors on the deal over at Canaccord Genuity Singapore. Columbia holds a majority stake in the company already, and I continue to believe Columbia’s interest in pursuing this deal is just the first step in a broader consolidation plan.

http://www.telecomramblings.com/2014/12/...a-simmers/

[tinkerstock]

I did not take the offer and I got the share certificate last week. Anyone knows what happen next? If I want to sell my share how do I do it? Did GK Goh sell theirs?

[swn]

Any compulsory acquisition of your stock?

[cherks]

I did not take the offer and I got the share certificate last week. Anyone knows what happen next? If I want to sell my share how do I do it? Did GK Goh sell theirs?

Hi tinkerstock, I just got an email from Boardroom, acting in behalf of GK Goh, to buy over my eunetwork shares. Did you get an email too? The deadline for acceptance is 5 Jun, 5pm. This is getting a bit interesting.

[ghchua]

Just for your information, GK Goh did not sell their shares in EuNetworks and they continue to hold shares in the company. Reason given in their annual report - GK Goh remain convinced that there is further business upside to EUN's dense urban fibre networks in key European cities. Management had been executing well, with EBITDA in 2014 growing to 28.3 million Euros (2013: 25.4 million Euros).

[cherks]

Just for your information, GK Goh did not sell their shares in EuNetworks and they continue to hold shares in the company. Reason given in their annual report - GK Goh remain convinced that there is further business upside to EUN's dense urban fibre networks in key European cities. Management had been executing well, with EBITDA in 2014 growing to 28.3 million Euros (2013: 25.4 million Euros).

Thanks for the reminder.

I have these questions and would like to thank in advance whoever is able to throw some light on them:


1. What responsibility does the company owe to small shareholders like us should it decide to list elsewhere, say Europe?

2. Is the company legally obliged to inform all remaining local shareholders, including some of us as small shareholders, who believe in the potential of this company and continue to hold on to their small stakes?

3. If such a listing were to happen, will the small shareholders like us who do not sell to GK Goh get notified, notwithstanding our small stakes? Or, can the company choose to ignore the small shareholders?


4. In the years to come when the company remains unlisted: If the company decides to declare dividend, is it legally obligated to pay out to the small shareholders like us? Does its obligation to SGX stay despite its delisting here[/u]?

[tinkerstock]

Just for your information, GK Goh did not sell their shares in EuNetworks and they continue to hold shares in the company. Reason given in their annual report - GK Goh remain convinced that there is further business upside to EUN's dense urban fibre networks in key European cities. Management had been executing well, with EBITDA in 2014 growing to 28.3 million Euros (2013: 25.4 million Euros).

Thanks for the reminder.

I have these questions and would like to thank in advance whoever is able to throw some light on them:





1. What responsibility does the company owe to small shareholders like us should it decide to list elsewhere, say Europe?

2. Is the company legally obliged to inform all remaining local shareholders, including some of us as small shareholders, who believe in the potential of this company and continue to hold on to their small stakes?

3. If such a listing were to happen, will the small shareholders like us who do not sell to GK Goh get notified, notwithstanding our small stakes? Or, can the company choose to ignore the small shareholders?


4. In the years to come when the company remains unlisted: If the company decides to declare dividend, is it legally obligated to pay out to the small shareholders like us? Does its obligation to SGX stay despite its delisting here[/u]?

swn: there was no compulsory acquisition.

cherks: i did not receive any email. when did they send it?

[cherks]

Hi tinkerstock, I got an email on 17 May from one Jessi Lim of Boardroom acting for GK Goh.

[d.o.g.]

1. What responsibility does the company owe to small shareholders like us should it decide to list elsewhere, say Europe?

2. Is the company legally obliged to inform all remaining local shareholders, including some of us as small shareholders, who believe in the potential of this company and continue to hold on to their small stakes?

3. If such a listing were to happen, will the small shareholders like us who do not sell to GK Goh get notified, notwithstanding our small stakes? Or, can the company choose to ignore the small shareholders?


4. In the years to come when the company remains unlisted: If the company decides to declare dividend, is it legally obligated to pay out to the small shareholders like us? Does its obligation to SGX stay despite its delisting here[/u]?

1. If the company is re-listed elsewhere, all shareholders will have a chance to buy/sell on that new exchange, subject to having a broker that can access that exchange e.g. if you use a broker that has no seat on AIM, and the company lists on AIM, you have to open an account with a broker that can let you trade on AIM, and to sell your existing shares you need to transfer your shares to a custodian that can deliver those shares to that broker. There will probably be detailed instructions sent out if/when this actually happens.

2. All shareholders are entitled to receive the same information. Only directors and employees would have additional information by virtue of their roles.

3. See #2.

4. When a company declares a dividend, all shareholders are entitled to their pro-rata share of dividends regardless whether the company is listed or not. This is basic company law. There is no "obligation to SGX" once a company is delisted, since by definition an unlisted company has no relation with SGX. However, anyone hoping for a dividend should note that the company had EUR 111.8m of accumulated losses as of 31 Dec 2014, making unlikely that any dividends will be paid for the next few years.

As usual, YMMV.