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BABYLON PUMP & POWER LIMITED — M&A Activity 2013
Dec 18, 2013
64557_rns_2013-12-18_f0733e78-2db1-4cd2-afd4-702fe3f2c8c1.pdf
M&A Activity
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==> picture [25 x 97] intentionally omitted <==
ASX
Release
19
December
2013
Acquisition of White Data Limited
IMI acquires Data Centre Management Company
-
IMI has entered an agreement to acquire White Data Limited
-
White Data manages the White Data Property Trust which has entered into a contract to acquire the Brisbane Data Centre site
-
Construction of the Brisbane Data Centre is scheduled to commence in Q2 2014
-
Development approval granted and a fixed price construction contract obtained
-
Brisbane Data Centre shell and core is independently valued at $95.5m on an as if complete basis
==> picture [511 x 106] intentionally omitted <==
Artist’s
impression
of
the
proposed
Brisbane
Data
Centre
**Overview
of
the
Acquisition**
IMI IMI
Limited
(ASX:
IMI,
IMIO)
(“ ”
or
“ the
Company ”)
is
pleased
to
announce
that
it
has entered
into
a
binding
agreement
to
acquire
100%
of
White
Data
Limited
(“ White
Data ”)
in exchange
for
$9.1
million
of
shares
in
IMI
(based
on
a
notional
issue
price
of
0.2
cents
per new
IMI
share)
(“ the
Acquisition ”).
The
Acquisition
is
subject
to
certain
conditions
described below
being
satisfied.
Following
completion
of
the
Acquisition,
IMI
expects
to
have
a
single
clear
focus
on development
and
management
of
data
centre
and
cloud
computing
services.
The
Board
believes
that
the
proposed
acquisition
of
White
Data
and
change
of
business
is
in the
interests
of
IMI
shareholders
and
is
a
very
positive
step
for
the
Company.
The
directors
IM Medical Limited T 03 9607 8280 Level 40 F 03 9613 4111 140 William St. Melbourne VIC 3000Aust E [email protected] ACN 009 436 908 W immedical.com.au
==> picture [25 x 97] intentionally omitted <==
believe
the
Acquisition
offers
the
potential
for
significant
growth
in
shareholder
value
over the
medium
term.
White
Data
is
a
specialist
management
company
focussed
on
becoming
a
leading
provider of
data
centre,
disaster
recovery
and
technology
solutions
in
Australia
and
the
Asia
Pacific. White
Data
intends
to
offer
data
centre
facilities
and
solutions
to
cloud
computing
service providers,
telecommunications
and
information
technology
providers,
the
financial
services sector,
the
mining,
oil
and
gas
sectors
and
public
sector
organisations
from
federal,
state and
local
governments.
White
Data
is
the
manager
of
the
White
Data
Property
Trust
(“ the
Trust ”)
which,
on completion
of
the
Acquisition,
will
own
the
group’s
first
data
centre
site
in
Brisbane (“ Brisbane
Data
Centre ”).
The
Trust
has
entered
into
a
contract
to
acquire
the
Brisbane Data
Centre
site
subject
to
completion
of
works
required
as
a
pre-‐condition
to
realigning
the boundary
of
the
site
and
certain
customary
regulatory
conditions.
On
completion
of
the
Acquisition,
IMI
will
have
an
interest
in
up
to
approximately
54%
of the
units
in
the
Trust
through
White
Data’s
current
direct
45%
unit
holding
and
an
$8
million convertible
note
(which
on
conversion
would
increase
White
Data’s
ownership
of
the
Trust by
9.2%
on
a
fully
diluted
basis).
In
addition,
White
Data
has
the
right
to
subscribe
for
up
to an
additional
$4.5
million
in
convertible
notes,
which,
if
exercised
in
future,
would
increase White
Data’s
ownership
in
the
Trust
by
a
further
3.9%
on
a
fully
diluted
basis.
IMI,
through
White
Data,
will
receive
fees
and
rental
margins
under
the
Management Agreement
between
White
Data
and
the
Trust
subject
to
future
occupancy,
and
will participate
in
any
distributions
by
the
Trust
via
White
Data’s
interest
in
units
in
the
Trust. White
Data
will
also
receive
a
Responsible
Entity
fee
from
the
Trust
(once
listed)
equivalent to
1%
of
the
gross
assets
of
the
trust
per
annum.
Construction
of
the
Brisbane
Data
Centre
is
scheduled
to
commence
in
Q2
calendar
2014 with
completion
of
the
first
stage
“shell
and
core”
scheduled
for
Q4
calendar
2014.
Development
approval
for
the
construction
of
the
proposed
Brisbane
Data
Centre
has
been granted
and
White
Data
has
negotiated
a
$40
million
(approximately,
excluding
GST)
fixed price
construction
contract
by
FDC
Construction
&
Fitout
Pty
Ltd,
part
of
the
FDC
Group, which
has
extensive
experience
in
the
construction
and
fitout
of
data
centres.
This
contract will
be
signed
before
completion
of
the
Acquisition
and
will
be
assigned
to
the
Trust
on completion
of
the
Acquisition.
The
proposed
Data
Centre
shell
&
core
has
been
independently
valued
at
$95.5m
on
an
as
if complete
basis,
with
construction
of
this
stage
scheduled
to
be
completed
during
Q4 calendar
2014.
Further
details
on
the
valuation
basis
are
provided
below.
IM Medical Limited T 03 9607 8280 Level 40 F 03 9613 4111 140 William St. Melbourne VIC 3000Aust E [email protected] ACN 009 436 908 W immedical.com.au
==> picture [25 x 97] intentionally omitted <==
The
Acquisition
is
conditional
on
the
Trust
having
an
offer
of
debt
finance
to
complete construction
of
the
shell
and
core
of
the
Brisbane
Data
Centre
on
terms
satisfactory
to
IMI by
completion,
expected
to
be
in
February
2014.
**New
Directors**
Mr
Brett
Johnson
will
join
the
Board
of
IMI.
Mr
Johnson
is
a
non-‐executive
director
of
Scott Corporation
Limited
and
Helloworld
Limited
(previously
JetsetTravelworld
Limited).
Mr Johnson
is
the
former
General
Counsel
for
Qantas
Airways
Limited.
On
completion
of
the
Acquisition,
Mr
Quentin
Masson,
Managing
Director
and
CEO
of
White Data,
and
Mr
John
Wilson,
non-‐executive
director
of
White
Data,
and
Mr
Colin
Loel,
director of
Colin
Loel
Architects,
will
join
the
Board
of
IMI.
The
appointments
will
bring
significant
expertise
to
the
IMI
Board.
A
profile
of
the
new
and proposed
directors
is
set
out
later
in
this
announcement.
On
completion
of
the
Acquisition,
with
the
appointment
of
the
new
directors,
the
existing directors
Mr
Nigel
Blaze,
Mr
Richard
Wadley
and
Mr
Paul
Burton
will
resign
from
the
IMI Board.
The
Board
will
consider
the
appointment
of
a
number
of
experienced
potential
directors
to further
broaden
the
skills
and
expertise
available
to
the
Board.
**The
White
Data
Property
Trust**
The
Trust
has
entered
into
a
conditional
agreement
to
acquire
the
Brisbane
Data
Centre
site from
certain
shareholders
of
White
Data.
A
wholly
owned
subsidiary
of
White
Data
will become
the
trustee
of
the
Trust
on
completion
of
the
Acquisition.
White
Data
will
consider
proceeding
with
a
separate
ASX
listing
of
the
Trust
following completion
of
the
first
stage
of
the
Brisbane
Data
Centre.
The
Trust
is
currently
in
discussions
regarding
bank
finance
to
fund
the
proposed construction
of
the
Brisbane
Data
Centre.
Completion
of
the
Acquisition
is
conditional
on the
Trust
being
offered
a
debt
finance
facility
on
terms
acceptable
to
the
Trust,
White
Data and
IMI
that
is
sufficient
to
complete
the
construction
of
the
Brisbane
Data
Centre
shell
and core
and
to
refinance
existing
debt
on
the
Brisbane
Data
Centre
site
of
approximately
$4.1 million.
The
funds
proposed
to
be
raised
by
the
Trust
from
the
issue
of
convertible
notes
to
White Data
will
be
used
for
working
capital,
to
support
the
proposed
debt
facility
and
to
repay
a loan
of
approximately
$800,000
relating
to
specific
costs
incurred
in
preparation
for
the Brisbane
Data
Centre
development.
IM Medical Limited T 03 9607 8280 Level 40 F 03 9613 4111 140 William St. Melbourne VIC 3000Aust E [email protected] ACN 009 436 908 W immedical.com.au
==> picture [25 x 97] intentionally omitted <==
In
its
capacity
as
trustee
of
the
Trust
(through
a
subsidiary),
White
Data’s
medium
term objective
is
for
the
Trust
to
acquire
and
develop
additional
data
centre
sites
so
it
becomes
a significant
specialist
property
trust.
The
Trust
is
in
early
stage
discussions
regarding potential
additional
capital
city
sites.
**The
Proposed
Brisbane
Data
Centre**
Development
approval
has
been
granted
for
the
construction
of
the
proposed
23,000 square
metre
data
centre
facility
on
the
approximately
3.4
Ha
site
comprised
of
five
data centre
halls
and
an
office
building.
White
Data
has
been
negotiated
a
fixed
price construction
contract
with
FDC
Construction
&
Fitout
Pty
Ltd
for
the
construction
of
the Brisbane
Data
Centre
shell
and
core
for
approximately
$40
million
excluding
GST,
which
will be
signed
before
completion
of
the
Acquisition
and
assigned
to
the
Trust
on
completion
of the
Acquisition.
The
base
building
and
fitout
is
targeting
a
design
that
plans
to
deliver
an Uptime
Institute
Tier
III
Data
Centre
rating,
a
minimum
NABERS
5
Star
and
LEED
Gold
rating. The
design
is
also
intended
to
deliver
a
Power
Utilisation
Efficiency
of
1.3
or
lower,
a
key factor
in
delivering
lower
operating
costs
and
attracting
tenants
to
the
facility.
The
fitout
is
expected
to
be
funded
by
the
future
issue
of
units
by
the
Trust
and
debt.
White Data’s
current
estimated
market
rental
is
$350kw
per
month.
The
data
centre
is
designed for
up
to
10-‐12
mW
capacity.
The
expectation
is
the
halls
will
be
filled
over
a
period
of years.
Valuation
The
proposed
Data
Centre
shell
&
core
has
been
independently
valued
at
$95.5m
on
an
as
if complete
basis,
with
construction
of
this
stage
scheduled
to
be
completed
during
Q4 calendar
2014.
The
valuation
has
been
prepared
by
Knight
Frank
Valuations
Queensland
on an
as
if
complete
basis
on
the
assumption
that
the
whole
of
the
property
is
to
be
leased
on market
based
terms
to
a
data
centre
operator
from
the
date
of
completion
of
a
purpose built
Data
Centre
Shell
and
Core.
The
key
assumptions
in
the
valuation
include:
-
Building
area
26,192
m[2] Gross
Building
Area
(GBA)
including
3,244
m[2] of
office
area -
Initial
power
supply
of
12MVA
with
ability
to
increase
to
in
excess
of
20MVA
in
future -
15
year
lease
term
with
2
x
5
year
options -
Adopted
market
rental
(for
first
Shell
&
Core
stage)
$9.08
million
p.a.
(Approximately $347/m[2] GBA) -
Capitalisation
rate
9.5% -
Discount
rate
11.0%,
Terminal
yield
11.0%
IM Medical Limited T 03 9607 8280 Level 40 F 03 9613 4111 140 William St. Melbourne VIC 3000Aust E [email protected] ACN 009 436 908 W immedical.com.au
==> picture [25 x 97] intentionally omitted <==
A
summary
of
the
valuation
is
being
prepared
and
will
be
included
in
the
Company’s proposed
Notice
of
Meeting
and
Prospectus
expected
to
be
dispatched
to
shareholders
in mid-‐January
2014.
**Acquisition
Terms**
The
key
terms
of
the
Merger
Implementation
Agreement,
which
contains
the
terms
of
the Acquisition,
are
as
follows:
-
(a) the
agreement
is
subject
to
a
number
of
conditions
including: -
IMI
shareholder
approval
and
receipt
of
an
independent
expert’s
report
concluding that
the
acquisition
of
IMI
shares
by
certain
White
Data
shareholders
is
reasonable to
unassociated
IMI
shareholders; -
completion
of
a
minimum
of
$12.5
million
equity
capital
raising
by
IMI
(“ Equity Capital
Raising ”); -
receipt
of
an
offer
of
debt
finance
to
complete
construction
of
the
shell
and
core
of the
Brisbane
data
centre
and
refinance
$4.1
million
of
existing
debt; -
completion
of
the
transfer
of
the
Brisbane
Data
Centre
site
to
the
Trust,
which
is conditional
on
completion
of
works
required
to
realign
the
boundary
of
the
site
and certain
customary
regulatory
conditions; -
re-‐compliance
with
Chapters
1
&
2
of
the
ASX
Listing
Rules
and
re-‐admission
to
the official
list
of
the
ASX. -
(b) IMI
will
acquire
all
the
shares
in
White
Data
from
its
existing
shareholders. Consideration
for
the
acquisition
of
White
Data
is
new
IMI
shares,
with
a
notional aggregate
value
of
approximately
$9.1
million
based
on
the
closing
price
of
IMI
shares on
16
December
2013
of
0.2
cents
per
share.
Immediately
following
the
Acquisition and
the
Placement
referred
to
below,
shareholders
in
White
Data
will
hold approximately
83%
of
the
shares
in
IMI.
The
consideration
will
be
paid
in
post-‐ consolidation
shares
conditional
on
IMI
completing
a
share
consolidation,
as
set
out under
“Capital
Structure”
below.
The
shareholding
of
the
White
Data
shareholders
is expected
to
decrease
to
below
40%
of
IMI
after
completion
of
the
Equity
Capital Raising.
-
(c) IMI
will
hold
a
shareholder
meeting
to
seek
approval
for: -
(i) the
1
for
100
share
consolidation; -
(ii) the
issue
of
shares
as
consideration
for
the
Acquisition; (iii) the
Equity
Capital
Raising; (iv) change
in
the
nature
and
scale
of
business
arising
from
the
Acquisition; -
(v) certain
shareholders
in
White
Data
obtaining
voting
power
in
more
than
20%
of IMI;
IM Medical Limited T 03 9607 8280 Level 40 F 03 9613 4111 140 William St. Melbourne VIC 3000Aust E [email protected] ACN 009 436 908 W immedical.com.au
==> picture [25 x 97] intentionally omitted <==
-
(vi) change
of
name
of
IMI
to
White
Data
Limited
and
associated
change
to
the constitution; -
(vii)
appointment
of
the
new
directors; -
(viii)
a
change
of
auditor;
and -
(ix) other
shareholder
approvals
as
required
to
effect
the
acquisition
of
White
Data, including
ratification
of
the
placement
(see
below
for
details).
**Corporate
Structure**
The
proposed
corporate
structure
of
the
IMI
group
following
the
Acquisition
and
prior
to
the Equity
Capital
Raising
is
set
out
below.
It
is
expected
that
the
Equity
Capital
Raising
will result
in
the
shareholding
of
the
White
Data
shareholders
decreasing
to
below
40%
of
IMI but
this
will
depend
on
the
size
and
terms
of
the
offer.
==> picture [319 x 347] intentionally omitted <==
IM Medical Limited T 03 9607 8280 Level 40 F 03 9613 4111 140 William St. Melbourne VIC 3000Aust E [email protected] ACN 009 436 908 W immedical.com.au
**Re-‐compliance
with
Chapters
1
&
2
of
the
ASX
Listing
Rules**
==> picture [25 x 97] intentionally omitted <==
The
proposed
acquisition
of
White
Data
constitutes
a
significant
change
in
the
nature
and scale
of
the
Company’s
activities
of
the
nature
contemplated
by
Chapter
11
of
the
ASX Listing
Rules.
As
a
result
of
changing
the
nature
of
its
activities
to
the
development, management
and
ownership
of
Data
Centres,
various
aspects
of
the
transaction
will
need
to be
approved
by
shareholders
and
the
Company
will
need
to
re-‐comply
with
the requirements
of
Chapters
1
and
2
of
the
ASX
Listing
Rules.
The
Company
intends
to
convene
a
meeting
of
shareholders
as
soon
as
practicable
to approve
the
necessary
aspects
of
the
transaction.
IMI
will
also
issue
a
prospectus
for
the Equity
Capital
Raising
to
enable
the
Company
to
complete
the
Acquisition
and
support
its intended
development
strategy.
Further
details
will
be
provided
in
the
Notice
of
Meeting and
the
Prospectus
which
will
be
sent
to
all
IMI
shareholders.
The
Notice
of
Meeting
will include
an
Independent
Expert’s
Report
which
has
been
commissioned
to
assist
all shareholders
in
understanding
and
assessing
the
proposed
Acquisition.
The
Company
expects
its
securities
will
be
suspended
from
trading
from
the
date
of
the meeting
of
shareholders
and
will
remain
in
suspension
until
the
Company
satisfies
the requirements
of
Chapters
1
and
2
of
the
ASX
Listing
Rules.
It
is
anticipated
that
the
IMI shareholder
meeting
will
occur
in
February
2014.
**Placement,
Proposed
Share
Consolidation,
Equity
Capital
Raising
and
Use
of
Funds**
IMI
has
received
commitments
for
a
share
placement
under
its
15%
placement
capacity
to sophisticated
and
professional
investors
introduced
by
Patersons
Securities
Limited
to
raise approximately
$248,000
before
costs
through
the
issue
of
124
million
shares
at
0.2
cents per
share
(“Placement”).
The
new
funds
will
be
applied
towards
costs
of
the
Acquisition
and capital
raisings
and
towards
general
working
capital.
Subject
to
shareholder
approval,
the Company
proposes
to
issue
1
free
attaching
option
for
every
2
shares
issued
under
the Placement
exercisable
at
0.25
cents
(pre-‐consolidation)
on
or
before
31
March
2016 (“Option”).
The
Company
intends
to
seek
shareholder
approval
to
consolidate
its
shares
and
to
raise
a minimum
of
$12.5
million
via
a
prospectus
offering.
The
Equity
Capital
Raising
is
expected to
comprise
an
institutional
placement
and
a
priority
offer
to
IMI
shareholders
of
not
less than
$3
million.
Patersons The
Company
has
appointed
Patersons
Securities
Limited
(“ ”)
as
Corporate Adviser
in
respect
of
the
Acquisition
and
as
Lead
Manager
to
the
Equity
Capital
Raising.
The structure
of
the
Equity
Capital
Raising
is
being
finalised,
and
further
details
in
respect
of
the capital
raising
will
be
set
out
in
the
prospectus
which
the
Company
expects
to
lodge
in January
2014.
IM Medical Limited T 03 9607 8280 Level 40 F 03 9613 4111 140 William St. Melbourne VIC 3000Aust E [email protected] ACN 009 436 908 W immedical.com.au
==> picture [25 x 97] intentionally omitted <==
The
proceeds
of
the
capital
raising
will
be
used
to
complete
the
Acquisition,
to
invest approximately
$8
million
in
convertible
notes
in
the
Trust,
to
pay
the
costs
of
the
Acquisition and
the
Equity
Capital
Raising
and
for
general
working
capital
purposes.
**Capital
Structure**
The
indicative
capital
structure
of
IMI
is
set
out
below
on
the
basis
of
completion
of
the Acquisition
and
$248,000
Placement.
| Shares | Options 2 |
Gross Amount | ||
| Indicative Capital Structure | % | |||
| (m) | (m) |
Raised ($m) | ||
| 717.7 | ||||
| IMI Securities on Issue | 828.4 | 15.1% | ||
| - | ||||
| Acquisition of White Data | 4,530.0 | 82.6% | ||
| 62.0 | ||||
| Placement | 124.0 | 2.3% | $0.25 | |
| 779.7 | ||||
| Total pre Equity Capital Raising | 5,482.4 |
100.0% | $0.25 | |
Additional
shares
will
be
issued
through
the
Equity
Capital
Raising,
which
will
be
for
at
least $12.5
million.
Details
of
the
proposed
share
consolidation
and
the
Equity
Capital
Raising
will be
set
out
in
the
Notice
of
Meeting
and
Prospectus
expected
to
be
lodged
in
January
2014.
A
pro
forma
post
Acquisition
Balance
Sheet
is
attached
to
this
announcement.
**Change
of
Company
Name**
The
Company
will
seek
shareholder
approval
to
change
its
name
to
White
Data
Limited
to better
reflect
the
nature
of
the
company
after
completion
of
the
Transaction.
**Indicative
Timetable**
| Event | Expected Date* |
|---|---|
| Dispatch Shareholder Meeting Documentation | January 2014 |
| Dispatch Prospectus | January 2014 |
| Shareholder Meeting | February 2014 |
| Suspend Company Shares | February 2014 |
| Complete Acquisition and Equity Capital Raising | March 2014 |
| Re-comply with Listing Rules 1 & 2 |
March 2014 |
- Shareholders
should
note
that
the
timetable
is
indicative
only
and
is
subject
to
change.
The
Company
will
keep shareholders
informed
of
the
timing
of
implementation
of
the
transaction
as
it
progresses.
IM Medical Limited T 03 9607 8280 Level 40 F 03 9613 4111 140 William St. Melbourne VIC 3000Aust E [email protected] ACN 009 436 908 W immedical.com.au
ACN 009 436 908
**New
Directors**
==> picture [25 x 97] intentionally omitted <==
**Brett
Johnson
–
Proposed
Non-‐executive
Director
(Chairman)** (LLB
(Syd),
FAICD)
Non-‐executive
director
of
Scott
Corporation
Limited
since
2005
and
Chairman
of
its
Audit Committee.
Non-‐executive
Director
of
Helloworld
Limited
(previously
JetsetTravelworld Limited)
since
2009
and
member
of
its
Audit
Committee
and
Remuneration
and Nominations
Committee.
General
Counsel
and
member
of
the
Executive
Committee
at Qantas
Airways
Limited
from
1995
to
2012.
Brett
brings
more
than
25
years
of
commercial, legal
and
governance
experience
gained
from
working
at
complex
Australian
listed companies
together
with
substantial
board
experience.
He
is
a
fellow
of
the
AICD.
**John
Wilson
–
Proposed
Non
Executive
Director** (JP,
FAICD,
FRCSA,
FAHRI)
Founder
and
Director
of
the
national
recruitment,
engineering,
IT
and
software
company, the
Bayside
Group,
with
more
than
230
employees
and
up
to
6500
on
hired
employees
in roles
across
many
specialist
disciplines
in
Australia
and
overseas.
John
brings
38
years
of business
development
skills
with
strengths
in
start-‐ups,
growth
strategy
and
planning,
new business
development
and
partnership
strategy.
John
is
Deputy
Chairman
and
a
Fellow
of the
Australian
Human
Resources
Institute
and
a
Fellow
of
the
AICD
and
the
Recruitment
and Consulting
Services
Association.
**Quentin
Masson
-‐
Managing
Director
&
CEO** (DSM,
MMgtStud,
BA,
GAICD)
Prior
to
co-‐founding
White
Data
in
2012,
Quentin
served
with
the
Australian
Defence
Force for
18
years
most
recently
as
a
Major
and
Senior
Executive
with
the
Special
Operations Command
and
Special
Air
Service
Regiment
(SAS).
Responsible
for
leadership
of
SAS operations
and
for
strategic
planning,
operations,
fleet
management,
public
relations, resource
and
facility
management,
compliance,
corporate
governance,
safety,
risk,
and disaster
management.
Quentin
has
also
managed
a
range
of
commercial
tender
processes, contract
negotiations
and
the
ongoing
contract
management
of
major
projects.
**Colin
Loel
–
Proposed
Non
Executive
Director** (B
Arch)
Colin
Loel
is
an
experienced
architect
who
has
worked
in
South
East
Queensland
region since
1986.
He
founded
Colin
Loel
Architects
in
1990
and
he
is
also
a
Director
of
a
number
of companies
including
Trade
Coast
Properties
Pty
Ltd.
Colin
performs
an
executive management
role
across
his
entire
property
portfolio.
Colin
was
the
lead
architect
for
the design
of
the
White
Data
Brisbane
Technology
Campus.
For
and
on
behalf
of
the
IMI
Board
Nigel
Blaze Chairman
IM Medical Limited T 03 9607 8280 Level 40 F 03 9613 4111 140 William St. Melbourne VIC 3000Aust E [email protected] ACN 009 436 908 W immedical.com.au