The OptiComm Ltd (ASX: OPC) share price has been among the best performers on the Australian share market on Tuesday.
The telecommunications company’s shares jumped as much as 12% higher this morning to $5.73.
And although it has dropped back a touch in afternoon trade, the OptiComm share price is still up a solid 9% to $5.59 at the time of writing.
Why is the OptiComm share price surging higher?
Investors have been buying OptiComm’s shares today after superannuation fund First State Super made a last-minute takeover approach.
This has been a major blow to Uniti Group Ltd (ASX: UWL), which was just days away from potentially sealing its $532 million acquisition of Opticomm.
If that acquisition doesn’t complete, Uniti will be left both red-faced and with a lot of surplus cash. It recently completed a $270 million equity raising and executed a $150 million debt facility agreement with Commonwealth Bank of Australia (ASX: CBA) and Westpac Banking Corp (ASX: WBC) to fund the acquisition.
Unsurprisingly, this news has hit the Uniti share price hard and it is down over 8% in afternoon trade.
What offer has been made?
This morning OptiComm revealed that it has received a non-binding and conditional competing proposal from First State Super of $5.85 per share in cash.
This is a 12.5% premium to the all-cash consideration offered under the Uniti scheme of $5.20 per share. It is also a 16.77% premium to the implied value of the all-scrip consideration offered under the Uniti scheme.
Given the premium on offer, the OptiComm board believes it is appropriate to engage in further discussions with First State Super. Though, due to the conditionality of the offer, at this stage it does not currently consider it to be a superior proposal to the Uniti scheme.
Nevertheless, OptiComm has granted First State Super with limited due diligence access until 18 September. At which point, it has requested a binding proposal be made.
In light of this, Uniti has postponed its scheme meeting which was due to take place on Thursday and vote on the acquisition.
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Motley Fool contributor James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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