Investment of N$95 million
Jo-Maré Duddy – Nimbus Infrastructure Ltd, which debuted on the local index of the Namibian Stock Exchange (NSX) as the country’s first capital pool company (CPC) on Oct. 6, intends acquiring 26.5% of the shares in Paratus Telecom.
The proposed transaction is worth N$95 million and will pave the way for Nimbus to be listed as a fully-fledged listed company on the NSX mainboard, the company said in an announcement Thursday on the local bourse.
In terms of the transaction Nimbus will acquire 8% of the issued share capital in Paratus from Cuvelai Telecommunications (Pty) Ltd for an initial cash payment of N$20 million. Cuvelai currently holds 33.9% of the issued ordinary shares in Paratus.
In addition, Paratus will allot and issue shares in Paratus to Nimbus for an amount of N$75 million. This will bring the effective shareholding of Nimbus in Paratus after the allotment to 26.5%, resulting in an effective 20.1% dilution of existing shareholders.
Nimbus will raise the cash needed for the entire transaction through a private placement.
The proposed transaction will provide Nimbus with exposure to diversified revenue streams, the company said in its announcement on the NSX.
“Paratus has an impressive track record, both in Namibia and across the continent. The company has grown its customer base aggressively, particularly in the corporate space, and is actively expanding into the retail market. They have shown a strong growth profile, with both revenue and profits expanding on a yearly basis,” Nimbus said.
By obtaining exposure to Paratus Namibia, Nimbus has immediate exposure to the current revenue and profits of Paratus, as well as the asset base, which includes terrestrial and urban infrastructure.
“Although the growth in revenues generated by Paratus is currently largely driven by fiber infrastructure roll-out, Paratus also has sustainable revenue streams from other sources such as cloud, connectivity, local area network, security and voice, providing exposure to diversified revenue streams for Nimbus,” the NSX announcement states.
According to Nimbus, a shareholding in Paratus provides it with a strong base from which to pursue further investments across Namibia and continent.
“The transaction does not preclude further investments by Nimbus, but rather creates a strong foundation from which to raise further capital, be it debt or equity, for further projects and acquisitions,” it says.
In addition, the transaction will see the majority of the capital raised by Nimbus invested into a viable asset. This will result in Nimbus making an early transition from a CPC to a full-fledged listed company on the NSX mainboard.
The transaction is subject to the fulfillment of certain conditions precedent, as well as regulatory approval. The latter includes the green light from the Communications Regulatory Authority of Namibia (Cran) and the Namibian Competition Commission (NaCC).