2SG acquisition just days away as Vonex completes due diligence

By Jonathan Jackson. Published at Feb 12, 2020, in Technology

Vonex Limited (ASX:VN8) has completed its due diligence with regard to its acquisition of the 2SG wholesale business.

Once complete, the acquisition of 2SG will provide Vonex with a boost to its Annualised Recurring Revenue (ARR),with group-wide ARR expected to increase to more than $14 million.

Completion of the transaction is expected to occur on 28 February 2020, with 2SG co-founder Jason Gomersall to join the Vonex board.

2SG is Brisbane-based established telecommunications and data wholesaler which provides Australian Managed Service Providers, ISPs and System Integrators with access to the latest in hardware and connectivity solutions from leading brands.

The company received circa $7 million in revenue last financial year, with revenue from mobile broadband a key growth driver.

2SG’s mobile broadband capability provides Australian ISPs the opportunity to sell a wireless broadband solution via the Optus 4G Network.

When Vonex first announced the acquisition, its shares surged 50% on the back of the news.

AAS Finfeed has previously reported, the acquisition is a mix of cash and shares with a $500,000 cash component and approximately 21.5 million shares to be issued at an issue price of 10 cents per share, escrowed for 12 months.

The conservative cash outlay helps in preserving the company’s cash position, while the share component highlights the belief that the 2SG Wholesale vendors have in Vonex taking the combined businesses to the next level and generating attractive returns for all shareholders.

Read: Vonex shares surge 50% on acquisition of 2SG

Completion of the due diligence into 2SG, comes days after the company announced it was divesting its mining interests, a move that would net the company $2.5 million to help it ramp up its telco operations.

S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.

Conflict of Interest Notice

S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.

Publishers Notice

The information contained in this article is current at the finalised date. The information contained in this article is based on sources reasonably considered to be reliable by S3 Consortium Pty Ltd, and available in the public domain. No “insider information” is ever sourced, disclosed or used by S3 Consortium.

Australian ASX Small Cap stocks | Why Finfeed.com is Australia’s leading small cap publication

Founded seven years ago, Finfeed.com is Australia’s leading and longest standing website for investor and finance news, education and expert opinion.

Published by StocksDigital, Finfeed was created to report daily on the comings and goings of ASX listed stocks in the small cap market.

As the first digital publication dedicated specifically to this space, Finfeed soon became the most trusted publication in the market, quickly garnering over two million page views – a number that continues to rise.

Finfeed.com provides its readers with informative articles that tackle the latest in market moving #ASX small cap news, plus exclusive content you won’t find anywhere else. It is aimed at those with an interest in investing, market education, company performance, start-ups and much more.

Finfeed.com is the only media organisation operating under the strength of a Financial Services License and is backed by leading journalists and analysts all with brands of their own.

The website aims to inform, educate and entertain with content that drills down into the heart of financial matters.

Finfeed is a leading source of investor and market information, with everything investors need to know about how to invest written in a way that anyone can understand. 

Over the years, the website has expanded beyond exclusively reporting on small caps, to profile Australia’s leading ASX listed small, mid and large caps as well as some of the country’s most successful CEOs and business leaders to find out what makes them tick.

Every day you will find fresh content covering:

Fast Facts

Over 4,000 articles published

Over 2.3 Million Page Views and counting

Over 10,000 followers on social media

Subscriber list growing by 2% monthly

Thanks for subscribing!

X