Search

Stargroup in the black after quality acquisition

Perth based ATM machine mover and shaker Stargroup continue to muscle in on the Australian ATM machine market with another acquisition.

Stargroup today announced that the acquisition of the unlisted “Cash Plus Australia” ATM network would turn the company cash flow positive for the first time with annual predicted combined revenues of $4.6m.

In a deal worth $6.5m, Stargroup will pay approximately 5 times Cash Plus’ EBITDA of $1.3m for their 109 machine network and Cash Plus connections including CEO David Dickinson will step up as major shareholders of Stargroup.

To fund the deal which is payable 50% in Stargroup shares and 50% in cash, Stargroup will conduct a 2 for 5 rights issue at 3.5c per share with one free attaching option for every 2 shares subscribed for.

The options will expire in 2018 with a strike price of 5c each.

Cash Plus connections will also be issued 61.9m Stargroup shares above market at 4c per share and the acquisition will see Stargroup pumping put 1.8m transactions a year from over 230 ATM machines sited in all Australian states.

Stargroup’s total assets will increase from $4,752,877 to $11,255,877 and the acquisition will see the company upgrade its forward year earnings guidance from a predicted loss of $731,916 to a profit of $592,464 before tax.

And with over $15m worth of historic tax losses that came with the original shell, it is reasonable to expect that most of those profits might actually hit the bank account.

Todd Zani, Stargroup’s CEO and Executive Chairman said Stargroup is excited to make this acquisition. Earnings accretive acquisitions are very much a part of the strategy that we laid out when we first merged with iCash and we are delighted that this first acquisition is such a high quality one.

David Dickinson is also an experienced ATM entrepreneur who has built significant ATM networks in both Australia and New Zealand. This acquisition is part of our commitment to becoming the largest ASX-listed ATM and payment services provider in Australia.”

The company says it will now focus on organic growth for the time being with around 70 ATM machines warehoused and ready for deployment. 

Add your comment

Stargroup (STL)

Share Price

Closing price for the last 90 trading days
Source: Morningstar

Total Shareholder Return as at 29/06/18

1 year TSR5 year TSR
4thAdvance NanoTek1986%102%
302ndGoldfields Money27%5%
496thWestStar Industrial-4%-54%
505thStargroup-6%-11%
767thCarnegie Clean Energy-61%-6%
722 WA (and selected non WA) listed companies ranked by 1 year TSR relative to other companies with similar revenue
Source: Morningstar

Share Transactions

09/08/17
$12k Bought
27/06/17
$0 Other
27/06/17
$35k Bought
Total value as at the date of the transaction
Source: Morningstar

Revenue

87th↑Stargroup$563k
96th↑Carnegie Clean Energy$5.3m
97th↓Advance NanoTek$5.1m
100th↑WestStar Industrial$4.6m
101st↓Goldfields Money$4.2m
239 listed industrial companies ranked by revenue.
Source: Morningstar

Remuneration from Stargroup

1366thJay Kim$29k
Ranked by total remuneration from all listed WA companies

BNiQ Disclaimer