- EROAD (ERD) is looking to draw up to $80 million from investors to acquire telematics provider Coretex for an initial NZ$157 million (A$147.69 million) payment
- The company entered a trading halt shortly after declaring the acquisition and its plans to raise capital
- The acquisition is expected to be completed in early H2 FY22, subject to certain regulatory and shareholder approvals
- Broadly, EROAD affirms the buy could significantly lift its position in North America and Australia
- EROAD shares last traded at $5.78
EROAD (ERD) is looking to draw up to $80 million from investors to acquire telematics provider Coretex for an initial NZ$157 million (A$147.69 million) payment.
The fleet management company entered a trading halt this morning while it geared up for capital raising efforts, which is set to be split across a NZ$64.4 million (A$60.5 million) placement and NZ$16.1 million (A$15.1 million) share purchase plan.
The acquisition is set to be completed in early H2 FY22, with a further NZ$30.6 million (A$28.79 million) contingent payment is expected in FY23 subject to certain Coretex performance milestones.
EROAD will require commission clearance, Overseas Investment Office approval and the all-clear from EROAD shareholders to proceed with the acquisition, which is set to be completed through its wholly-owned subsidiary company.
ERD has described the proposed acquisition as transformational and believes it could significantly lift its market position in North America and Australia.
Cannacord Genuity is leading and underwriting the placement, with Bell Potter acting as co-leader.
The trading halt is set to be lifted on Thursday, July 15, when the outcome of the capital raising is disclosed to market.
EROAD shares last traded at $5.78.