Satellite Solutions Worldwide to buy Australian and Norwegian assets for £1.8m

Broadband provider Satellite Solutions Worldwide Group is to buy BorderNET Internet in Australia and the customer bases of NextNet and AS Distriktsnett in Norway all for a combined £1.8m in cash and shares, bringing an additional 5,500 customers in total.

The acquisitions are part of the company’s roll-up strategy as it will integrate BorderNET’s operations into the existing Australian business Skymesh and NextNet and AS Distriktsnett will be integrated into its existing Norwegian hub, Breiband.

BorderNET is a specialist broadband provider to farming and remote communities and the Australian government, through NBN Co, will continue to invest in its SkyMuster satellites which will provide increased access to satellite broadband services.

The BorderNet acquisition is subject to consent from NBN Co, the Australian government’s broadband provider, and the company will pay AU$1,85m (£115m) in total comprising of an initial payment of AU$1.43m (£894,577), including a retention amount of AU$200,000 (£124,300) and the balance of AU$413,125 (£256,759) will be paid in shares.
BorderNET recorded a loss of AU$26,804 (£16,554) in 2015 although it has an annualised revenue run rate of over £1m and the company expects BorderNET to be profitable under ownership.

Meanhile, for NextNet the company will pay 5,04m Norwegian kroner (£489,486) and a further 200,000 kroner (£19,424) for stock and certain infrastructure assets.

NextNet also reported a loss of 1,53m kroner (£148,215) in 2015 and has an annualised revenue run rate of about £800,000.

For AS Distriktsnett the company will pay 832,500 kroner in cash (£80,852) for the customer base, and the overall consideration is subject to adjustment in cash in respect of final customer numbers at completion of the acquisition.
Chief executive Andrew Walwyn said: “These are the first three acquisitions of 2017, which significantly strengthen our position in these key regions. Having established strong hubs in Norway and Australia last year, we can now readily acquire sub-scale, local businesses and rapidly turn them into profitable assets by integrating them onto our global platform.

“We continue to grow user numbers and revenues in these territories and to actively pursue acquisition opportunities, in line with our global strategy, as we continue our consolidation of last mile broadband across Europe and Australasia.”

Shares in Satellite Solutions were down 0.11% to 8.86p at 0857 GMT.

(digitallook)