Webcentral has struck a binding deal to sell a majority stake in some of its assets for circa $165 million to a group of European buyers including Oakley Capital, Street Talk can reveal.
The deal is understood to include two-thirds of three divisions, two of which are the email hosting services businesses and C Panel hosting. The two camps are expected to complete the deal in the coming month, after finalising a restructure of resources and debt financing.
Webcentral’s shares were halted on Thursday morning pending the announcement. Sources said the deal stemmed out of a board-ordered review of its operations run by Macquarie Capital with the goal of releasing unlocked value.
Webcentral posted $96.2 million revenue and a $22.2 million before-tax loss for the 2023 financial year. The divestments are expected to leave it with about $45 million revenue, while improving group profitability significantly.
They should also leave Webcentral laser-focused on servicing business customers as a telco operator and infrastructure landlord, sources said. It should have nearly 2500 enterprise customers on its books, as well as several wholesale clients.
The company had a $36 million market capitalisation. Its share price has fallen 31 per over the past 12 months.
Its managing director, Joe Demase, is the largest shareholder with 17.27 per cent of the company. Tectonic Investment Management, a fund manager based in Kingscliff, is the only other substantial shareholder and owns 6.05 per cent of Webcentral.