- Proposed transaction will unlock shareholder value and streamline Nera’s business activities
- Nera expected to record a disposal gain of approximately S$71.5 million upon closing, a significant portion of which is intended to be paid out to shareholders
- Shareholders to vote on the proposed sale at an Extraordinary General Meeting expected to be held in Q3 2016
Nera Telecommunications today announced the proposed sale of its payment solutions business to Ingenico Group S.A. for S$88 million. Ingenico, with the world’s largest payment acceptance network, is the global leader in seamless payment, providing smart, trusted and secure solutions to empower commerce across all channels (in-store, online and mobile).
Nera has entered into a conditional share sale agreement with Ingenico which will result in the sale of the Company’s entire payment solutions business across Singapore, Malaysia, Thailand, the Philippines, Indonesia and Vietnam.
Nera expects to record a disposal gain of approximately S$71.5 million and subject to legal and contractual restrictions, it intends to return a significant portion of the net proceeds from the sale to its shareholders.
Samuel Ang, President & CEO of Nera, said, “The offer by Ingenico represents an attractive opportunity for us to unlock shareholder value and sharpen our focus on our core network solutions business, in line with our strategic objective of streamlining our business activities. We are proud of 2 our payment solutions team for building a high quality regional business, and are confident that Ingenico Group has the capability to take our team to the next level under their global umbrella.”
Philippe Lazare, the Chairman and Chief Executive Officer of Ingenico Group, said, “We are extremely excited about welcoming Nera payment solution’s management team to Ingenico. The acquisition will further strengthen Ingenico’s relationships with banks and retail merchants in Southeast Asia and will enhance the deployment of Ingenico’s entire product range in the region using Nera payment solution’s extensive distribution and services network.”
Based on Nera’s FY2015 financials, its payment solutions business accounted for approximately 26% of the Company’s total revenue of S$181.5 million and approximately 21% of its total earnings of S$13.4 million. Ingenico’s offer of S$88 million represents 35% of Nera’s market capitalization of S$251.5 million as at close of trading on 19 May 2016.
The proposed transaction is subject to approval by Nera shareholders at an Extraordinary General Meeting (“EGM”), which is scheduled to be held in Q3 2016. A formal announcement on the EGM and the distribution of the EGM circular to all shareholders will follow in due course.
Asia Systems Ltd (an entity controlled by the Northstar Group), which owns approximately 53.38% of Nera, has executed an irrevocable undertaking to vote in favour of the proposed transaction.
Rippledot Capital Advisers acted as the financial adviser to Nera in connection with the proposed transaction.