MNF Signs Term Sheet with Vonex
Sydney, June 7, 2021 AEST (ABN Newswire) - MNF Group Limited (
ASX:MNF) (M2S.F) today announced that it has signed a conditional term sheet with Vonex Limited (ASX:VN8) ("Vonex") for the sale of part of its direct business ("Direct Business"), for $31 million. The term sheet is non-binding other than customary matters including exclusivity.
The sale is in-line with MNF's strategy to simplify the business, grow recurring revenues and focus on growing the MNF wholesale business, Symbio.
The Direct Businesses that form the sale agreement include those that provide cloud phone, mobile and internet services directly to small business and residential customers in Australia. These customers are predominantly served by the MyNetFone brand; however the brand is not part of the sale and MNF will retain the Enterprise and Government clients.
Importantly, the term sheet includes a requirement for the parties to enter into an exclusive Symbio wholesale supply agreement for phone numbers and minutes with a five-year contract term. The wholesale supply agreement means MNF retains over $3.0 million per annum in existing revenue for the domestic wholesale business.
Assuming all conditions are satisfied, MNF expects that an asset sale agreement will be executed in July 2021. Conditions to finalising the agreement include: a satisfactory outcome of due diligence on MNF, funding for the transaction being secured and board approval for both Vonex and MNF.
Commenting on the milestone, MNF Group CEO Rene Sugo, said:
"The divestment of these direct businesses is in line with our strategy to simplify MNF's business and drive growth in our CPaas and UCaas voice services, which are in high demand. Importantly, funds from the sale will be reinvested into our growing wholesale business and our expansion offshore.
"Assuming all conditions are met, we expect the sale to be completed by end of July 2021."
The agreement would value the direct business at approximately 2x revenue. This doesn't include the benefit from the retained long-term wholesale supply agreement.
Reaffirmation of Guidance
The Company would like to take this opportunity to re-affirm earnings guidance of EBITDA for the 2021 financial year of $40.0 million to $43.0 million.
About Symbio Holdings Limited
Symbio Holdings Limited (ASX:SYM) is a software company changing the way the world communicates.
Symbio's technology replaces old-fashioned telecom networks with software, making it faster and easier to deliver modern cloud-based communication services, unlocking endless new applications for calling, messaging and phone numbers.
Symbio is the backbone for the global cloud communication industry. Over 500 service providers - from telecom start-ups to the world's biggest software companies - rely on Symbio for the connectivity, quality and expertise they need to solve complex communication challenges.
Headquartered in Sydney, Symbio powers billions of calls and messages each year, owns networks in three countries and employs over 450 staff worldwide.
For more information about Symbio visit www.symbio.global
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