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Uniti enters into AU$3.62b takeover bid with Morrison-Brookfield consortium

Uniti enters into AU$3.62b takeover bid with Morrison-Brookfield consortium

Uniti Group has signed a A$3.62 billion takeover contract with a consortium led by New Zealand’s Morrison and Co and Canada’s Brookfield Asset Management.

Under the Scheme Implementation Instrument, MBC BidCo (MBC) is offering a cash price of A$5.00 per Uniti share, valuing the transaction at A$3.62 billion and valuing the enterprise at approximately A$3.73 billion.

Uniti’s board of directors unanimously recommended shareholders to vote in favor of the system. Uniti shareholders will vote on the deed of sale at the meeting scheduled for July.

“The value that the Morrison/Brookfield consortium has placed on Uniti is a testament to the strength of the Uniti business we have built over the past three years since our listing in ASX in February 2019,” said Michael Simmons, Managing Director and CEO of Uniti.

“We have built a high-quality business with long-term annual profits, which are generated from fiber access networks and best-in-class communications technologies.”

Uniti first entered discussions with Morrison and Co last month, before Brookfield joined the investment firm, leading to an initial offer of A$4.50 per share.

Following the bid, Uniti Group was approached by the Connect Consortium, which included Macquarie Infrastructure and Real Assets and the Canadian Public Sector Pension Investment Board, which offered a cash consideration of A$5 per share to acquire Uniti. This show was then matched by MBC at the end of last month.

At the time, Unity said that although both bids were the same, the Connect Consortium requested that the company not enter into binding transaction documents with a third party regardless of whether the alternative bid was better than the terms it offered.

During its first half results, Uniti reported a 98% jump to A$110 million, a 355% increase in EBITDA to A$65.8 million, and an increase in net profit from A$3.9 million to A$29 million.

“More than 90% of our profits are now generated from high-margin, annual recurring revenue delivered predominantly on our proprietary ultra-fast FttP networks, and this percentage will continue to expand due to the deployment of the contracted FttP order book of nearly 300,000 buildings. Simmons said at the time.

The results come on the heels of Uniti’s purchase of Opticomm and Telstra Velocity, which it has spent the past year merging.

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