LINK Mobility: Termination of non-binding term sheet to acquire Soprano Design
Oslo, Norway, 19 September 2021 at 18:45 CEST. LINK Mobility (LINK) has reached a mutual understanding with Soprano Design to not proceed with the intended transaction. Please refer to stock exchange release by LINK on 18 May 2021 regarding LINK having entered into an exclusive non-binding term sheet to acquire Soprano Design for a purchase price of NOK 3,590 million to be settled by LINK issuing 88,706,339 new shares (a 30% increase in the number of shares outstanding) and a cash payment of AUD 25 million, valuing Soprano Design at a forecasted fiscal year 2021 EV/cash EBITDA multiple of 19.7x.
Formal SPA negotiations and due diligence have been progressing since May. However recent developments, which LINK deemed material to the transaction, made LINK conclude that a renegotiation of the initial agreed upon terms and conditions in the term sheet was necessary for the transaction to be completed. The parties have been discussing changes to the term sheet this week but were not able to reconcile on new terms. Therefore, the parties have today ended the negotiations and terminated the term sheet.
"This is part of business when you have a buy and build strategy that certain transactions do not go through. This decision will however have no operational effect on LINK, and we will continue to pursue and execute on LINK's strategy creating long-term value for the shareholders. LINK recently expanded beyond Europe to the US with the Message Broadcast acquisition and LINK continues to observe favourable industry tailwinds", says Guillaume Van Gaver, CEO of LINK.
LINK has a strong cash position and generates significant excess cash also when deducting capex, interest cost and tax. Cash and cash equivalents as of the second quarter in 2021 were NOK 808 million which will be used for M&A purposes. Pro forma LTM Q2 2021 EBITDA including all closed acquisitions was reported at NOK 622 million. LINK expects annual interest cost and capex at approximately NOK 280-300 million, resulting in material cash generation further fuelling M&A activities.
LINK reiterates its forward-looking statement to 2024 pro forma revenue of NOK 10,000 million and a pro forma adjusted EBITDA margin of 15-17%. The revenue target assumes a gradual increase in organic growth to 20% with full effect from the go-to-market (GTM) strategy, industry tailwinds and continued M&A.
For further information, please contact:
Guillaume Van Gaver, CEO
+33 6 32 25 91 25
Thomas Berge, CFO
+47 41 31 90 28
Tom Rogn, VP Investor Relations
+47 94 85 56 59
tom.rogn@linkmobility.com
About LINK Mobility
LINK is one of Europe's leading providers of mobile messaging and communications platform as a service (CPaaS) solutions for increased engagement. The company serves enterprise, SME, and government customers. LINK offers a wide range of innovative and scalable mobile solutions, creating valuable digital convergence between businesses and customers, governments and citizens, platforms and users. LINK has 44,000 customer accounts globally and exchanges more than 10 billion messages a year. LINK is listed on the Oslo Stock Exchange under the ticker LINK.
This information is considered to be inside information pursuant to the EU Market Abuse Regulation, and is subject to the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.
The stock exchange announcement was published by Tom Rogn, VP Investor Relations, LINK Mobility Group Holding ASA, at the date and time as set out above.