Dreamscape buys Singapore firm for $30m

22/06/2017 - 10:28

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ASX-listed tech firm Dreamscape Networks has entered into an agreement to acquire a Singapore-based hosting and domain services business for about $30 million in cash and scrip.

Dreamscape buys Singapore firm for $30m
Mark Evans says the acquisition is strategically important for Dreamscape.

ASX-listed tech firm Dreamscape Networks has entered into an agreement to acquire a Singapore-based hosting and domain services business for about $30 million in cash and scrip.

Perth-based Dreamscape, which itself provides internet hosting and domain name registration services, will pay $S20 million ($A19 million) in cash and issue 42.5 million in shares at a deemed issue price of 25 cents each to wholly acquire Vodien Group.

The deemed price is a 31.5 per cent premium to Dreamscape’s 20-day volume-weighted average price.

As part of the acquisition, Vodien’s founders will join Dreamscape’s board as executive directors.

Vodien is the top hosting provider in Singapore and third in the provision of the ‘.sg’ domain tag, with over 27,000 customers, 52,000 domain names registered, and more than 26,000 active hosting customers.

The acquisition consideration represents an 8.4 times annualised 2017 earnings before interest, tax, depreciation and amortisation multiple.

“This is a strategically important acquisition for Dreamscape Networks,” managing director Mark Evans said.

“The leadership team at Vodien Group has substantial knowledge of the local industry, with a strong track record of growth, and will be a great addition to our senior executive team.  

“By acquiring this strong Asian hosting brand, we can leverage its current market position and strong customer awareness to immediately increase our footprint in the South‐East Asia region, without the need to establish our own Singapore hub infrastructure.  

“We have a great opportunity to introduce existing customers of both organisations to additional add‐on value products and services.   

“This is an exciting development for investors, employees and customers of both organisations, and is consistent with our plan to invest in strategic opportunities that enhance our offer and accelerate  growth.”

The deal is expected to be completed by the end of next month.

Dreamscape shares were 7.5 per cent higher to 21.5 cents each at 10:20am.

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