ISentia Program Booklet Details Net Debt and Value Before Takeover

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iSentia has published the Scheme Booklet which provides shareholders with information on the proposed acquisition by Access Intelligence for all iSentia shares that it does not already own.

The acquisition is carried out by means of a plan of arrangement in Australia, the booklet giving the shareholders the reasons to vote in favor of the plan.

ASX reveals net worth and debt of media watch company iSentia

iSentia also announced that on July 16, the Supreme Court of New South Wales issued orders approving the calling of a meeting of iSentia shareholders to consider and vote on the Scheme Meeting and approving the distribution. an explanatory statement containing information about the program. , the report of the independent expert and the notice of the meeting of the scheme (together, the Scheme Booklet) to the shareholders of Isentia and mentioned that Access Intelligence will not be able to vote at the meeting of the scheme in with regard to its shareholders.

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The booklet quotes: “The program offers the opportunity to realize some cash value for your entire investment in iSentia. If the Scheme does not continue, the iSentia share price may decline, including at a price well below the value of the total cash consideration. If the program does not continue, it is likely that iSentia will need to raise equity capital to repay debt and fund working capital and continued investment in the business.

“Such a capital raising would have a dilutive effect on shareholders who are not eligible or who choose not to participate in the fundraising. In addition, there can be no certainty that the capital increase will be successful or as to the price at which any capital increase will be undertaken, which may be much lower than the value of the total cash consideration.

The brochure also mentioned that if the program was not implemented, shareholders would continue to be subject to the risks associated with iSentia’s business and general market risks, such as a changing competitive landscape, market conditions. industry, competition continues in Australia and New Zealand which has affected customer retention and pricing, current headwinds of COVID-19 in iSentia’s Southeast Asian markets, Tribunal findings of copyright, iSentia’s limited room for maneuver and the business challenges iSentia faces in FY21 rather than realizing some value for all of their iSentia actions through the program.

“ISentia revenue and underlying EBITDA1 (a company’s earnings before interest, taxes, depreciation and amortization) for the 12 months to June 30, 2021 are estimated to be between A $ 82 million and AU $ 84 million. million Australian dollars and 13.5 million Australian dollars to 14.5 million Australian dollars. [respectively], (compared to A $ 101.7 million and A $ 25 million for the 12 months to June 30, 2020), based on unaudited management accounts. The net debt is estimated between 34 and 35 million Australian dollars (23.4 million Australian dollars as of June 30, 2020) ”, indicates the booklet.

This financial data was affected in part by the October 2020 cyber incident which had a direct impact of approximately AU $ 3.3 million on revenues, a direct impact of approximately AU $ 4.4 million on the earnings before interest and taxes (EBIT) and a direct impact of approximately AU $ 4.4 million on cash. .

In addition, and as previously reported, the cyber incident caused a delay in key strategic projects that aimed to reduce the churn rate in the business and, as noted in the presentation of the results for the first half of FY21, has had an impact on the results of fiscal year 21 compared to expectations.

If the program does not continue, iSentia will continue to execute its current business strategy in FY22 and it is likely that iSentia will need to raise equity to repay debt and fund working capital and investments. continuous in the company.

Such a capital increase would have a dilutive effect on shareholders who are not eligible or choose not to participate in the capital increase. There can be no certainty that the capital increase will be completed successfully or as to the price per iSentia share for such a capital increase.

The booklet added that FY 22 could also be affected by the business challenges faced by iSentia in FY 21. iSentia is also awaiting the outcome of its claim in the Copyright Court.

This comes after Access Intelligence shareholders voted in favor of acquiring iSentia following a general meeting held on July 9.

Additionally, the company has received shareholder approval to raise funds to raise a total of £ 50million (AU $ 92.830million) for the acquisition.

The proceeds of the fundraising will be used, among other things, to finance the equity counterpart of the acquisition and to repay the entire amount of the debt drawn from iSentia.


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