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  • Spirit Technology Solutions (ST1) has tapped investors for $23.8 million to fund its acquisition of Australian telecom business Nexgen
  • The buy is expected to double Spirit’s business services and assets, and potentially generate $36 million in predominantly recurring revenue
  • Split between cash and shares, the cash portion of the buy will be fuelled by the recent capital raise and an upgraded Commonwealth bank debt facility
  • Completion of the acquisition is expected to occur around April 8, 2021
  • Spirit Technology Solutions is is up a healthy 8.57 per cent following the announcement, trading at 38 cents per share

Spirit Technology Solutions (ST1) has tapped investors for $23.8 million to fund its acquisition of Australian telecom business Nexgen.

The move is set to bring in over 5000 new business-to-business clients for Spirit and potentially generate $36 million in predominantly recurring revenue.

Consideration for the buy will be a blend of cash and shares, with 30 per cent of the consideration in Spirit shares and the remaining 70 per cent in cash from the capital raise and a Commonwealth Bank debt facility.

Spirit has managed to fund the cash portion of the buy by offering up 72,161,000 shares at 33 cents apiece to sophisticated institutional investors via an unconditional share placement.

The remaining cash is expected to stem from Commonwealth Bank debt facility, which has been given the tick of approval to increase to $25 million.

Spirit Managing Director Sol Lukatsky said the acquisition more than doubles the company’s business services and assets.

“Additionally, this transaction gives us a much deeper presence nationally and in particular in Sydney and Brisbane,” he explained.

“Adding over 100 salespeople and 5500 news customers will immediately have a
material impact on our organic growth via an increased sales pipeline,” he concluded.

Completion of the acquisition is expected to occur around April 8, 2021.

Spirit Technology Solutions is is up a healthy 8.57 per cent following the announcement, trading at 38 cents per share at 2:29 pm AEDT.

ST1 by the numbers
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