# WCG - Webcentral Limited



## kateclaire (6 November 2006)

Hiya,
Just wanted to know what people's thoughts are on MLB. I know that in the past they have crashed and burned but have seen good and steady increases in recent times... I think they are worth a second look. Would like to hear what other people's opinion on them is.


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## 3 veiws of a secret (7 November 2006)

kateclaire said:
			
		

> Hiya,
> Just wanted to know what people's thoughts are on MLB. I know that in the past they have crashed and burned but have seen good and steady increases in recent times... I think they are worth a second look. Would like to hear what other people's opinion on them is.




Again there is an article (from memory) in the October edition of Smart Investor mag......p.78


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## Ken (25 May 2007)

I think the graph speaks for itself.....


Looks very steady....  massive build up.

3 or 4 years could easily be double figures if the growth continues, in a global market.

IT is back in favour.


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## Kimosabi (25 May 2007)

I wonder if the poor bugger who bought them at $17 in April 2000 is still holding, hoping one day to get his money back...


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## grace (15 December 2007)

This is one of the top 10 picks for 2008 by Smart Investor Magazine (Dec edition).  I have held for about 12 months.  Good fundamentals IMO.


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## grace (19 February 2008)

Good profit announcement out today as follows:-

(year on year)
EBIT up 141%
NPAT up 118%
Fully franked div up 56%
No debt (all paid off)
Cash in Bank!

All on target.  No dissapointments!

PE  16
PEG 0.34
Div 3.7%

Expecting growth to continue above 07!

I continue to hold.


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## grace (11 September 2008)

I continue to hold this one because they continue to perform well.

Div 4.8%
PEG  0.66
PE   14

Earnings and Dividends Forecast (cents per share) 
      2007 2008 2009 2010 
EPS 17.7 21.5 26.4 30.0 
DPS 13.0 15.5 19.4 22.1

No debt either.


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## Tukker (5 October 2009)

HI grace and others,

What do you think about technical support at 1.50. I got a buy signal this week for MLB and like the way its setting up. Huge volume on Friday to.



> *1:25:35 PM	1.595	2,703,417	4,311,950.115	XTOS*




Couldn't find what the XTOS means. But I'm guessing its something to do with options. Not sure tho. 

Sell off at the end of august was due to a decrease in profits caused by a one off $50mil purchase.  Its not a loss, its a reduction in profit and they claim they have weathered the most of it rather well. On top of that their outlook is better due to decreased cost of goods and general cost reductions.  


I think the market has overreacted, stochastic say they same.  I will buy in around $1.55


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## grace (5 October 2009)

Tukker said:


> HI grace and others,
> 
> What do you think about technical support at 1.50. I got a buy signal this week for MLB and like the way its setting up. Huge volume on Friday to.
> 
> ...




Thanks Tukker....I parted with this little gem at $2.20 or above.  Looking at buying back as this is a well run company with sound fundamentals paying a nice div.  Thanks for the TA there!  I have been watching it slowly decline, but October could be rocky.......or not.


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## gohawks (5 February 2010)

grace said:


> Thanks Tukker....I parted with this little gem at $2.20 or above.  Looking at buying back as this is a well run company with sound fundamentals paying a nice div.  Thanks for the TA there!  I have been watching it slowly decline, but October could be rocky.......or not.




No discussions re MLB for ages.

What are peoples thoughts of the stock at present? I have been watching them for the last few months with interest. Dividend certainly looks attractive but does this stock have much growth left in it?


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## Nero64 (6 February 2010)

It's been trading in a tight range for the last few months. 

I think there is a possible perception that it is going to raise capital as its annual report couldn't give a clear picture on its future funding. 

Personally I work in the telco/internet industry and see a future for domain and web hosting especially with the NBN coming up. We used to deal with Melbourne IT but found they couldn't offer the full gamut of domain prefixes. -.org, .biz and .net etc so we went to another provider. However Melbourne IT has the most domains registered in its books.


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## craft (12 March 2013)

MLB sell 39% of their Segment EBIT for 86% of their Enterprise Value. Nice.

http://www.asx.com.au/asxpdf/20130312/pdf/42dlxmhmqw1ntg.pdf


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## princeplanet (12 March 2013)

craft said:


> MLB sell 39% of their Segment EBIT for 86% of their Enterprise Value. Nice.
> 
> http://www.asx.com.au/asxpdf/20130312/pdf/42dlxmhmqw1ntg.pdf




Nice div coming up, just to be clear, it's not being suspended, just the reinvestment plan, right?


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## Ves (12 March 2013)

craft said:


> MLB sell 39% of their Segment EBIT for 86% of their Enterprise Value. Nice.
> 
> http://www.asx.com.au/asxpdf/20130312/pdf/42dlxmhmqw1ntg.pdf



I remember you saying you bought a while back when it was much lower than the current market price.    Capital management initiatives as mentioned in the announcement could completely de-risk your position.


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## InCasinoOut (12 March 2013)

Trading halted apparently with announcement of "Melbourne IT sells Digital Brand Services Division". 12/03/2013

Interesting...

EDIT: sorry, mentioned above.


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## craft (12 March 2013)

princeplanet said:


> Nice div coming up, just to be clear, it's not being suspended, just the reinvestment plan, right?




Yes - only the reinvestment scheme that is being suspended, obviously they don’t need more cash at the moment.   



Ves said:


> I remember you saying you bought a while back when it was much lower than the current market price.    Capital management initiatives as mentioned in the announcement could completely de-risk your position.




After CGT transaction cost etc and retiring all debt they should have proceeds from the sale of about  $1.20 per share. Let’s see what they do with the cash. 

I’ll take the trade sale price as vindication for what I saw on offer in the share price.


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## robusta (12 March 2013)

craft said:


> I’ll take the trade sale price as vindication for what I saw on offer in the share price.




Nice one Craft, I had a look at MLB a while ago but evidently missed something you found.


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## skc (13 March 2013)

craft said:


> MLB sell 39% of their Segment EBIT for 86% of their Enterprise Value. Nice.
> 
> http://www.asx.com.au/asxpdf/20130312/pdf/42dlxmhmqw1ntg.pdf




The announcement said ~$100m cash left after transaction costs, capital gains etc - so $1.2 per share. How much is the remaining parts of the business worth?

DBS recorded $9.5m EBIT. The rest had $15.2m EBIT. Corporate overhead was $5.5m at the EBIT level. So after the sale the business is left with ~$10m EBIT (assuming similar corporate costs). I've ignored one-off costs from the FY12 numbers. Note the rest of the business is going backwards in revenue and the EBIT level. FY11 the EBIT was $18.3m before corporate costs.

I should be close to $0 given debt is basically paid off. Tax rate has been 20-25% depending on their R&D tax refund... so NPAT ~$7.5-8.5m depending on how much corporate costs they can shave off. What PE ratio can you put on this business? At 8x it's worth $80m. At 12x it's worth $120m. So somewhere between $1 to $1.4. But given the fall in EBIT in those segments I suspect the lower end of the range. 

It still brings the total value to at least $2.2 plus any franking that people can utilise.

The market probably won't immediately catch on. Look at the share price reaction of SLM and CSV when they sold a major part of the business...


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## skc (13 March 2013)

skc said:


> The market probably won't immediately catch on. Look at the share price reaction of SLM and CSV when they sold a major part of the business...




Red marks the day SLM ad CSV announced major divestment. Remarkable isn't it...


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## princeplanet (13 March 2013)

skc said:


> Red marks the day SLM ad CSV announced major divestment. Remarkable isn't it...
> 
> View attachment 51294
> 
> ...




So it's gonna drop a fair bit immediately, then trend up? Did you see this coming? 16% ! Blimey!!


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## skc (14 March 2013)

princeplanet said:


> So it's gonna drop a fair bit immediately, then trend up? Did you see this coming? 16% ! Blimey!!




Did I see what coming? That it'd open high and get sold down? 

Not exactly see it coming as such, but I am mindful of what could happen based on the two examples above. A possible explanation is that some investors react to the headline transaction figure and compared that with the market cap and that segment's share of revenue and concluded that the business is worth $2.40+.

I had a plan to buy on open if it was below $2.10, so there was so trade for me on this.

Now the opportunity will come when they announce the capital management details as well as possible funny price action post the capital return.


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## G Gekko (4 May 2013)

How does everyone rate MLB at the moment? They seem like a reasonably solid business albeit struggling to turn larger profits over the last few years. But they seem to perform better as the economy picks up, note the growth over the years prior to 2008/2009 when the GFC set in. I presume that the better the economy performs and the more confidence in it, the more businesses are willing to invest in IT.

This being said as well, they recently(ish) sold their Digital Services division for a nice sum which should leave them low on or without debt positioning them well for the future. Someone here rated them at $2.20 a share... I think that's fair in _present_ day circumstances. But I think eventually as the market picks up MLB IT should be carried along with it.

Does anyone else disagree?


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## pixel (23 July 2013)

G Gekko said:


> How does everyone rate MLB at the moment? They seem like a reasonably solid business albeit struggling to turn larger profits over the last few years. But they seem to perform better as the economy picks up, note the growth over the years prior to 2008/2009 when the GFC set in. I presume that the better the economy performs and the more confidence in it, the more businesses are willing to invest in IT.
> 
> This being said as well, they recently(ish) sold their Digital Services division for a nice sum which should leave them low on or without debt positioning them well for the future. Someone here rated them at $2.20 a share... I think that's fair in _present_ day circumstances. But I think eventually as the market picks up MLB IT should be carried along with it.
> 
> Does anyone else disagree?




Just the contrary, GG: I agree.
So much so that I'm buying 





And I am well aware of the 25c special divi coming up, so the sp might drop back towards $2 sfter tomorrow.


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## pixel (4 December 2013)

It has taken a while, but today's announcement about the intended cap return (at last!!!) appears to find favour in the Market. (I hold already.)


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## tinhat (17 January 2014)

New CEO announced today. MLB came up in a technical scan this evening but is the data correct? Which one is correct?

Stock Doctor chart



Yahoo Finance chart



I'm guessing the price didn't gap up 38% on Monday morning or someone would have said something!


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## pixel (18 January 2014)

tinhat said:


> New CEO announced today. MLB came up in a technical scan this evening but is the data correct? Which one is correct?
> 
> Stock Doctor chart
> View attachment 56365
> ...




I've been trading and accumulating MLB for a long time and can categorically say the Yahoo one is correct; I've never trusted  the Stock Doctor, and this makes me feel vindicated again.


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## tinhat (18 January 2014)

pixel said:


> I've been trading and accumulating MLB for a long time and can categorically say the Yahoo one is correct; I've never trusted  the Stock Doctor, and this makes me feel vindicated again.
> 
> View attachment 56368




Thanks Pixel. They had a software upgrade about a week ago and it looks like they have some problems with their data. Not good.


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## jbocker (31 January 2014)

The cap return to Investors was announced last month and supposed to be 54c per share, and since that announcement the price had climbed to 1.93 from 1.63 or thereabouts.
At the meeting 28 Jan the vote went in favour of the cap return to holders as at 5 Feb.

Today 30 Jan the price fell around 50c.
I expected that drop in price after 5 Feb, so why did it drop today.
What am I  misreading or missing?


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## craft (31 January 2014)

jbocker said:


> The cap return to Investors was announced last month and supposed to be 54c per share, and since that announcement the price had climbed to 1.93 from 1.63 or thereabouts.
> At the meeting 28 Jan the vote went in favour of the cap return to holders as at 5 Feb.
> 
> Today 30 Jan the price fell around 50c.
> ...



The 5th is the record date for the capital return – anybody on the register as of that date will get the return.

To be on the register as of the 5th you must have bought the shares by the Ex-entitlement date. The Ex-date is 4 trading days prior to the record date which equates to the 30th January.  You must have bought BEFORE  the EX date to have the shares recorded under your name on the register and be entitled to the distribution. Hence you had to have purchased by close of trade on the 29th to be entitled and why it opened with the gap on the 30th.

The Ex date being prior to the record date is to allow time for the stock to be transferred and registered under the T+3 settlement rules.

Exactly the same process as determining who gets paid dividends.


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## pixel (31 January 2014)

Well explained, craft.
I had been wondering why the announcement didn't include the ex-date. Would've made understanding so much easier. It seems jbocker wasn't the only confused holder. The initial bids started pretty high and drifted down only later during the course of trading.




And anticipating the next question: Since the shares are now worth 54c less, charts have had their history adjusted by that amount, because otherwise, trends and other calculated indicators won't be meaningful. You have to compare apples and apples - in this case: previous trades in terms of today's shares.
Note: If your chart history has not yet been adjusted, your data supplier may be tardy; give them a nudge - or change to one that does. D2MX get their data from web.IRESS


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## jbocker (31 January 2014)

Thanks Craft, and Pixel. Would have been nice to publish an Ex date. I didnt see the difference till I refreshed a screen on the ASX site. Interestingly Melbourne IT's own website does not point that out, and the chart still shows the un-adjusted scale with a big decline yesterday.

Will need to make sure the before and after $ values are explained to the tax accountant.
Cheers


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## pixel (31 January 2014)

jbocker said:


> Will need to make sure the before and after $ values are explained to the tax accountant.
> Cheers



Tax accountants are rarely interested in the basis for your Technical Analysis, which is the only purpose of a chart.
My Tax Accountant always insisted on copies of Contract Notes. Even when I sent him every trade in a spreadsheet (from my Portfolio Manager software), he kept asking for those PDFs, which he used for Audit purposes.

Meanwhile, I've picked up enough smarts to submit my own tax return, and "sava da monnee"


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## robusta (27 February 2014)

MLB have made a deal to buy Netregistry.

http://www.zdnet.com/melbourne-it-to-purchase-netregistry-in-au50-4m-deal-7000026832/

Wonder if ASIC will approve and how they will go in the long term against competition.


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## indeck (28 February 2014)

robusta said:


> MLB have made a deal to buy Netregistry.
> 
> http://www.zdnet.com/melbourne-it-to-purchase-netregistry-in-au50-4m-deal-7000026832/
> 
> Wonder if ASIC will approve and how they will go in the long term against competition.




I hadn't thought of that, but I would say it's unlikely they would block it.  Too many larger international players in the market, blocking 2 locals merging would be silly.


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## Ves (28 February 2014)

Hmmm... so if Netregistry contributes $6m EBITDA + $5m synergies = $11m and they are forecasting $10-11m EBITDA from existing operations (pre NRG acquisition) then that's a total of say $20m-22m EBITDA.

Current Market Cap of $118m,   probably about $125m on current prices after the shares are issued to the NRG vendor.

So it's trading on an EBITDA multiple (ignoring cash left after the acquisition) of about  6-6.25x?

Seems fairly reasonable for this point of the IT cycle,  what am I missing?


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## robusta (28 February 2014)

I have allways found it too difficult to workout the economics of the domain name business. I don't know what the competition are doing and not sure of the margins they can get. Maybe some more research is needed


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## waimate01 (28 February 2014)

The business model revolves around customers not knowing what they really should be paying for these things.


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## So_Cynical (21 February 2015)

Bought a few on Thursday at $1.33 on the basis that Melb IT is an established business that has consistently delivered for shareholders (all-be it intermittently) for over a decade and a half, management know how to leverage success.

The new focus on domains and site services opens up potential for revenue growth thru services combined with the solid recurring cash flows of domains.


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## jbocker (27 July 2015)

Well So-Cynical I hope you still holding this one, MLB have been going quite well since your post.

This is a stock I have free held for a number of years and has been a great dividend supplier.
Looking forward to their annual report late August.


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## So_Cynical (28 July 2015)

jbocker said:


> Well So-Cynical I hope you still holding this one, MLB have been going quite well since your post.
> 
> This is a stock I have free held for a number of years and has been a great dividend supplier.
> Looking forward to their annual report late August.




Yep still holding, pretty good timing on my part, i really like the way MLB treat their holders, my kind of stock.

Was thinking about selling down this week with the 1.90 high, this stock does tend to go up and down a bit...looking at the 1 year chart - it's a very steep rise, unsustainable i would think.
~


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## So_Cynical (19 June 2017)

So_Cynical said:


> (Jul 28, 2015) Yep still holding, pretty good timing on my part, i really like the way MLB treat their holders, my kind of stock.
> 
> Was thinking about selling down this week with the 1.90 high, this stock does tend to go up and down a bit...looking at the 1 year chart - it's a very steep rise, unsustainable i would think.
> ~




2 Years on and that rise ^ was unsustainable, took a breather for 18 months and then climbed again. 

Through $3 today - really happy with the last capital raising, rights issue that was ex on the day of announcement and no extra shares could be applied for, thats how you value your share holders.
~


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## System (1 June 2018)

On June 1st, 2018, Melbourne IT Limited (MLB) changed its name and ASX code to ARQ Group Limited (ARQ).


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## greggles (26 February 2019)

Rebound today for ARQ Group after a miserable 12 months that saw its share price decline from a high of $3.72 to a low of $1.63.

Today saw the release of its 2018 Full Year Financial Results and a subsequent 14.04% share price gain to $1.95. They didn't seem that impressive to me so I can only assume that the market was expecting something much worse.

Underlying EBITDA, EPS and NPAT all down. On the bright side, gross revenue was up. The start of a turnaround perhaps?


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## Ann (26 February 2019)

greggles said:


> Rebound today for ARQ Group after a miserable 12 months that saw its share price decline from a high of $3.72 to a low of $1.63.




I haven't got today's price spike (delayed data) but there looks to be some almighty selling pressure about to cut in from around 2.10 to 3.20. 

This is an EquiVolume chart which shows selling pressure where there are fat blocks of colour for those not familiar with this sort of chart.


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## So_Cynical (3 May 2019)

Pulled up a 10 year chart for some longer term perspective, ARQ (old Melb IT) on or just below the long term upward trend line, fundamentally the numbers are all ok without 
being spectacular, a yield of over 4% should be sustainable into the future - seems decent value at around this price level with MC and total revenue both around 200M.
~


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## So_Cynical (27 June 2019)

Hammered today down 38% due to an updated earnings outlook and cancellation of the approaching interim dividend, closed at 80c wow...would seem a little over done.


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## jbocker (28 June 2019)

Not sure the followers have appreciated or understand their consolidation strategy since implementation and it seems that have had a few stumbles in delivering on that transformation.  They are two thirds along their delivery timeline.
I had made some good dividend money over the years and stopping that has certainly belted their SP as So_Cynical has mentioned.

Ever since it has changed its name from MLB to ARQ I have been yelling something that rhymes with arq every time I see their SP.

Watching for the bleeding to stop and then I will relook at buying them.


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## greggles (24 September 2019)

Huge downgrade from Arq Group today. CEO Martin Mercer steps down.


> *Revised Guidance*
> 
> Market conditions in the Company’s Enterprise division have softened markedly and it has become clear that forecast revenue growth for the second half of 2019 will not be achieved. Cost reduction initiatives will be insufficient to offset the revenue shortfall.
> 
> As a result, Group underlying EBITDA is expected to be in the range of $16.8m to $19.3m (compared to previous guidance for the Group of $27.0m to $30.5m).




ARQ share price has been smashed following the announcement, reaching a low of 30c but currently trading at 36c, down 33.33%.

$51.6 million in net debt at the end of July. It's all starting to look very grim. This is definitely one to avoid for the foreseeable future.


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## barney (24 September 2019)

greggles said:


> Huge downgrade from Arq Group today. CEO Martin Mercer steps down.




Always hate to see Stocks get smashed like this …… Someone is likely losing their shirt


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## sptrawler (24 September 2019)

It reminds me of an IT company I was involved in years ago, called Candle, later became Clarius, started out at around $3 paid a dividend really well run, slowly ground down to nothing. Really sad from memory.


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## jbocker (24 September 2019)

sptrawler said:


> It reminds me of an IT company I was involved in years ago, called Candle, later became Clarius, started out at around $3 paid a dividend really well run, slowly ground down to nothing. Really sad from memory.




It is very sad for holders. 
Mercer has been stood aside, (lets say outside). New CEO search is on. Macquarie Capital (Australia) Limited to undertake a strategic review. Are those vultures I can see on the horizon?



jbocker said:


> Ever since it has changed its name from MLB to ARQ I have been yelling something that rhymes with arq every time I see their SP.



You should have heard me today!!!


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## barney (24 September 2019)

sptrawler said:


> It reminds me of an IT company I was involved in years ago, called Candle, later became Clarius, started out at around $3 paid a dividend really well run, slowly ground down to nothing. Really sad from memory.




Yep … I've been on the wrong end of some sharp trading halt/suspension situations over the years which means you can't even escape if you wanted to …… Every time I see a massive fall in anything it brings back bad memories …..


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## So_Cynical (27 September 2019)

The selling was accompanied by big volume - someone dumping, an incredible decline, 3.70 to 30c in under 2 years with no fraud or any kind of funny business.


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## barney (27 September 2019)

So_Cynical said:


> The selling was accompanied by big volume - someone dumping, an incredible decline, 3.70 to 30c in under 2 years with no fraud or any kind of funny business.




Yeah, its about as ugly as a chart can get.  I had a quick glance through their recent reports.  

So market cap is about $40 million …… Cash and cash equivalents held is about $7 million.

They have about $51 million in debt.  Projected earning to be flat for 2nd half of 2019 but anticipated improvement by 2nd half 2020.

I assume dividends of any sort will be terminated??

Assuming all the above is close to being correct, can anyone with better fundamental understanding than me hazard a guess as to whether they can bring it back to life?

If it goes low enough, is there enough value for it be a takeover target?  They seem to be going ok in some parts of the business but bad in others.

I note the current CEO is transitioning out …. That is never a great look  tough days ahead it seems.


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## System (26 June 2020)

On June 26th, 2020, ARQ Group Limited (ARQ) changed its name and ASX code to Webcentral Group Limited (WCG).


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## Dona Ferentes (10 August 2020)

*things are afoot at Webcentral*

https://www.afr.com/technology/acti...p-targets-webcentral-shake-up-20200810-p55k6p

Activist investor Merchant Group is back with a new target locked in, buying up a significant position in Webcentral, the struggling IT company formerly known as Arq Group and Melbourne IT. Merchant has acquired an 8.84 per cent stake in Webcentral, purchasing a large parcel of shares from Investors Mutual.

Merchant Group MD Andrew Chapman said the company had been on its radar for six months, but now was the right time to pounce because of the proposed acquisition by Web.com, owned by New York-based private equity firm Siris Capital Group.


> _When you look into the detail, there is a viable alternative out there and I do not think they have fully explored them in the domestic space. Instead they have taken the easy way out_, he told* The Australian Financial Review.* _They are throwing the baby out with the bath water without exploring domestic opportunities ... The debt piece is what needs to be negotiated on, so you need to negotiate with the domestic banks here ... but then if there's a local player that can implement change and drive business outcomes, the banks stand to win because they can recover a fair portion of their debt_.




Webcentral was formerly known for its domain name registration business, but a few years ago it commenced a turnaround to become a digital services company, servicing large enterprise clients and small and medium-sized businesses, specialising in creating customer-facing digital products.

While the business recorded $83.6 million in revenue for the 2019 full year to December 31, this was a drop of more than 16 per cent on the previous year. Its loss after tax from continuing operations also ballooned to $43.7 million.

One of the biggest issues facing the company is its mounting debt. Webcentral has about $62 million in interest bearing loans and borrowings at the full year, but a portion of this was paid back following the sale of its enterprise services division this year.
_



			A business turning over close to $100 million should be able to make money,
		
Click to expand...


_


> Mr Chapman said_. [The turnaround fell over] thanks to basic business stuff. They sold their core asset, went into the digital market space and they didn't have the skills, knowledge or capability to do so. ..They also spent $9 million on an office fitout, instead of paying down debt. They do not have the money to burn on that stuff_.




.... Since May 2018, Webcentral has fallen from a share price of more than $3.60 to only 10¢, giving it a market capitalisation of $12.2 million, despite turning over close to $84 million last year...

Mr Chapman will need to win the support of fellow substantial shareholder Karl Siegling backed Cadence Capital for any shake up plans he wants to execute at Webcentral. Mr Siegling sits on the Webcentral board.

These plans include a board refresh, as well as hunting for a new, local buyer, rather than Web.com, which has offered the company 10¢ a share. Mr Chapman was confident there were Australian companies that would be interested in buying Webcental, thanks to its extensive customer base.


> _With a second wave of COVID-19 decimating the Australian economy we need to protect existing jobs more than ever, _he said_. The current move on Webcentral is a COVID 19-driven opportunity. Australian companies need to be protected during this period. I am getting involved because I believe in the company and I think it has a great future under new leadership_.


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## Dona Ferentes (4 September 2020)

_and.... another outfit interested in WCG. _

• 5GN has acquired a 10.2% strategic interest in Webcentral Group Limited (WCG)
• 5GN plans to leverage 5GNs expertise and asset base to improve the profitability of WCG
• 5GN has previously undertaken detailed due diligence on WCG as part of their recent strategic review process
• 5GN intends to use the proceeds of the capital raising to fund a _*potential acquisition of WCG*_ and refinancing WCG’soutstanding debt

Webcentral 1 year chart


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## Dona Ferentes (7 September 2020)

Webcentral has received a non-binding indicative proposal from 5GN to acquire all of the shares in Webcentral.

The key features of the 5GN Proposal include:
 The transaction would be conducted as an off-market takeover bid.
 The pre-conditions to the takeover bid are the negotiation and entry into a bid implementation agreement between 5GN and Webcentral and a unanimous Webcentral board recommendation.
 The consideration under the takeover bid would be *1 5GN share for every 12 Webcentral *shares. 
 The only proposed defeating conditions to the takeover bid are
(a) a 50.1% minimum acceptance condition,
(b) a no ‘prescribed occurrences’ condition and
(c) a no material adverse change condition. 
5GN will declare the offers under its takeover bid wholly unconditional upon obtaining a relevant interest in at least 50.1% of Webcentral shares (assuming no other defeating condition has been breached before 5GN obtains such a relevant interest).
 5GN proposes to provide a loan to Webcentral to allow Webcentral to pay its existing financiers the full amount outstanding under its existing debt facilities.
 The 5GN Proposal is not conditional on 5GN raising further financing or undertaking due diligence.


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## Dona Ferentes (7 September 2020)

50% up ... very generous


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## frugal.rock (7 September 2020)

Making a comeback for my ARQ entry in the yearly comp.
Long way to go to break even on the entry figure though...


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## over9k (7 September 2020)

From a previous high of $3.70 a share. Ouch.


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## frugal.rock (7 September 2020)

Yes, around middle of last year I received the lesson
"Knife catching 101" from ARQ.
If I recall I was in around 0.45 and lost a fair bit in it. 
Another live case study around the same time was DCN.
The lessons successfully taught me how NOT to catch knives.... 
and has given some insight into how to actually catch a falling knife... without a bloody mess that is.


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## Dona Ferentes (15 September 2020)

*1. Webcentral *had entered into a scheme implementation deed dated 12 July 2020  with *Web.com *Group, Inc. under which it is proposed that Web.com will acquire all of the shares in Webcentral for $0.10 per share (the Scheme); 
*2. Webcentral *had received a non-binding indicative proposal from *5G Networks* Limited to acquire all of the shares in Webcentral by way of a conditional off-market takeover bid. The consideration under the 5GN Proposal is proposed to be 1 5GN share for every 12 Webcentral shares; and 
*3. the Webcentral Board *had determined that the 5GN Proposal is a Superior Proposal (as defined in the SID and, accordingly, had commenced the matching right process outlined in the SID. 

WEB.COM COUNTERPROPOSAL 
The matching right period under the SID expired at the end of yesterday. Web.com has provided a counterproposal to Webcentral offering to *increase the cash consideration *payable under the Scheme to $0.155 for each Webcentral share


_- that is a fair hike, 10c to 15.5c per share. Someone thinks it is worth something !_


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## Dona Ferentes (18 September 2020)

RECOMMENDS *5GN *OFF MARKET TAKEOVER BID ( of 1 5GN share for every 12 Webcentral shares)

Webcentral today announces that:
... the Webcentral Board has determined that neither the Web.com Counterproposal nor the Revised Web.com Proposal (with the revised consideration of $0.18 per Webcentral share) would provide an equivalent or superior outcome for Webcentral shareholders as a whole compared with the 5GN Proposal;
... the Webcentral Board has determined that the 5GN Proposal is a Superior Proposal to the Web.com Counterproposal and the Revised Web.com Proposal, notwithstanding the increased headline cash offer of $0.18 by Web.com; and
... Webcentral has entered into a bid implementation deed with 5GN


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## Dona Ferentes (18 October 2020)

5GN has declared the takeover Offer for WCG unconditional. 

_As set out in Webcentral’s Target’s Statement, 5GN has agreed that, if it acquires at least 50.1% of the Webcentral Shares, 5GN will (via a subsidiary) provide a secured loan to Webcentral of approximately $47.7 million. Webcentral will, in turn, use the money from that loan to repay its Existing Financiers in full. Webcentral will then owe approximately $47.7 million to 5GN. _
_Webcentral will have to repay that loan, which will bear interest at a rate higher than the interest rate under the Existing Debt Facilities by approximately 2 times, within 12 months. 5GN has stated that if it does not acquire 100% of the Webcentral Shares, it will require Webcentral to repay the loans provided by 5GN to Webcentral.

In those circumstances, Webcentral may need to undertake an equity raising to repay some or all of the loans provided by 5GN. It is reasonable to expect that any such equity raising will likely be at a material discount to the then prevailing share price and if any Webcentral Shareholders do not participate in that equity raising, they are likely to be materially diluted. _

_If these risks conflict with your individual risk profile, you should strongly consider these implications in making your decision as to whether to ACCEPT the Offer._


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## frugal.rock (20 November 2020)

At this rate, I might get back into the black for the entry in the yearly comp....go figure. Thought I was a dead duck in the water for a while...


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## frugal.rock (23 November 2020)

frugal.rock said:


> At this rate, I might get back into the black for the entry in the yearly comp....go figure. Thought I was a dead duck in the water for a while...



Well, dip me in tar and roll me in feathers...flip n Eck.


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## frugal.rock (6 January 2021)

Well, this is the lesson that just keeps on giving. 
Let's just keep reopening the wound and salting it again...eh?!
Bar steward.


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## Dona Ferentes (6 January 2021)

I thought it was a _done deal_

.... and then (22/12)







> Webcentral Group Ltd has today repaid $5.2m of loans advanced to [5GN] in October 2020. This follows the earlier repayment in November 2020 of the $500,000 loan to fund the break fee payable by WCG in relation to the termination of the scheme with Web.com.
> The funds repaid will be utilised to partially repay 5GN debt funding bank loans and for other working capital and acquisition opportunities. The remaining loan amount owing from WCG to 5GN is approximately $42 million.




too complex for me


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## System (25 November 2021)

On November 25th, 2021, Webcentral Group Limited changed its name to Webcentral Limited.


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## Dona Ferentes (22 August 2022)

_hard to make a buck in telco-land_; down nearly 20% today :

 _revenue and other income for the period was $96.73  million, representing growth of 5.5% compared to the prior comparative period of $91.69 million._
_ The loss of the Group for  the period  after providing for income tax  amounted to $24.38  million  (2021:$5.86 million loss).    _
_The underlying EBITDA of the Group for a goodwill impairment charge of $11.49 million,  the period of $17.6 million was 13.5%    higher than the prior comparative period of $15.47 million, after adjusting for a non-cash  goodwill  impairment  expense of    $11.49 million, non-operating items including share-based payments expense of $8.83 million, restructuring costs of $3.71    million in  relation  to the merger between the  Group and 5G Networks Limited and other non-recurring items, and acquisition costs of $0.90 million._
And they have sold  the block stake in Cirrus Networks Holdings Limited (ASX: CNW) in an on-market trade today. The sale of Webcentral’s holding of 172 million shares (18.5% of CNW) will provide a cash inflow of $5.5m. These proceeds will be used to fund potential acquisitions, on-market share buybacks as announced on 3 August 2022 and to reduce debt. Webcentral is reviewing a number of acquisition targets and will pursue these more synergistic high EBITDA-accretive investments.


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