Channel 7 to buy Unwired for $127m
- — 27 September, 2007 11:00
Rumours that Channel 7 was to buy Unwired were confirmed this morning with the company announcing a $127 million offer for the wireless Internet service provider.
"Seven Network Limited proposes to make an off-market takeover offer to acquire 100 per cent of the issued shares of Unwired Group Limited (Unwired) for cash consideration of 45 cents per share," said a statement to the ASX.
Seven said it was willing to offer 50 cents for each of Unwired's 254.2 million shares if certain criteria are met, taking the price to $127 million.
The repercussions of this sale are good for Channel 7. With Unwired, they will have access to the largest spectrum of WiMAX spectrum in metropolitan Australia. Kerry Stokes, chairman of Channel 7, was quoted in the press release as saying "Despite delays in certification of the technology to date, we believe in the potential of WiMAX as a mobile broadband solution."
Channel 7 and Unwired are advising shareholders to accept the takeover offer as soon as possible to maximise the return from their shares.
Unwired has expressed unanimous and overwhelming support for the offer from Seven to the Unwired shareholders. In a statement the company "recognised the substantial premium to recent trading prices implied by the offer. The directors look forward to recieving Seven's Bidder's Statement and to maximising the outcome for all shareholders."
This offer follows the acquisition of 19.9 per cent of shares in Unwired by engin. Seven is quoted as being "wholly supportive of the strategic benefits identified by engin at the time of its investment in Unwired." Engin are expected to provide close consultancy about the development and planning for the network.
Current Unwired shareholders will receive a Bidder's Statement from Seven around the end of September 2007.