- Family Zone Cyber Safety (FZO) is raising $146 million to help it acquire fellow online safety business Smoothwall
- FZO will spend £75.5 million (A$142.0 million) in cash buying the UK company, which services around 38 per cent of the UK market
- This includes more than 12,000 schools and 6 million students to generate around $30 million in annualised recurring revenue
- Family Zone will raise the funds via a $71 million placement and a $75.4 million entitlement offer, with new shares worth 55 cents each
- Shares in FZO remain suspended from trade, having last traded for 60 cents each
Family Zone Cyber Safety (FZO) is raising $146 million in extra capital to help it acquire fellow online safety business Smoothwall.
FZO announced the news on Friday morning, after placing its shares in a trading halt earlier this week, confirming it will spend £75.5 million (A$142.0 million) on the acquisition.
The all cash deal will see Family Zone buy 100 per cent of the shares on issue of TopCo Oasis — the current owner of Smoothwall.
FZO said the UK digital safety business serviced more than 6 million students and 12,400 schools, generating $30 million of annual recurring revenue.
Smoothwall provides four core services including a filter, firewall, monitor and safeguard record manager.
To fund the purchase, FZO has announced a $71 million placement and a $75.4 million entitlement offer for investors and shareholders respectively.
Around 266.1 million FZO shares will be issued under the offers, with new shares priced at 55 cents each —an 8.3 per cent discount to the last traded price on July 30.
Explaining the significance of the acquisition, Family Zone said in a statement that Smoothwall’s technology was complementary to its own.
“The acquisition of Smoothwall represents a unique opportunity for Family Zone as a highly complementary business of significant scale with an attractive target market customer base,” FZO said in today’s market release.
Shares in Family Zone Cyber Safety remain suspended from quotation this morning, with FZO due to begin trading again by Monday, August 9.
Company shares were last trading for 60 cents each.