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QIC's proposed $494 million takeover of Superloop (ASX: SLC) is dead in the water after the two parties could not come to a suitable transaction offer.
Superloop says that after opening up the books to QIC Private Capital for a three-week period of exclusive due diligence neither party could come to an agreement.
"The announcement on 3 May 2019 had clearly noted there was no certainty that the Revised Indicative Proposal would eventuate in an acceptable offer for the Company," says Superloop in an ASX statement.
"However, it was the view of the Board of Superloop at that time it was in the best interests of Superloop shareholders to engage with QIC and provide them with a limited period of exclusivity to conduct due diligence in order to establish whether an acceptable binding transaction could be agreed."
"The Board in discussion with QIC have been unable to agree to a transaction and on that basis, the parties have decided to discontinue the period of exclusivity."
The proposed deal would have seen QIC Private Capital, on behalf of its global infrastructure managed and advised funds and clients, acquire the Bevan Slattery (pictured) founded company for $1.95 per share.
Initially, QIC lodged a takeover bid with Superloop on 2 April for $1.90 per share.
Superloop recently completed a $30 million equity raise to put towards future development plans.
This raise was the latest piece in the puzzle for a three-way play by serial entrepreneur Bevan Slattery, the founder of Superloop, Megaport, and its subsidiary SubPartners, NextDC, Asia Pacific Data Centre and PIPE Networks.
The company intends to deploy the new capital to strengthen its balance sheet, provide additional funding to allow Superloop to take advantage of new opportunities, and to provide general working capital.
Superloop is in the midst of a multi-national infrastructure build, connecting more than 275 key data centres in the Asia Pacific.
Its undersea fibre optic network as part of the INDIGO Consortium which stretches around the Asia Pacific is the company's main project. The group owns and operates over 640 km of carrier-grade metropolitan fibre networks in Australia, Singapore and Hong Kong.
Once the whole cable system is up and running it is expected to strengthen links between Australia and the fast-growing South East Asian markets, providing lower latency and enhanced reliability. Using today's coherent optical technology, the cable's two-fibre pairs will be able to support up to 36 terabits per second.
Superloop's revenue is generated from three operating segments: 1) connectivity, which includes revenue generated from the group's metro fibre networks in Singapore, Hong Kong, Australia, a fixed wireless network in Australia, and revenues related to the development of the INDIGO subsea cable network, 2) broadband, which includes revenues generated from Superloop WiFi for resorts & student accommodation and from Superloop Home Broadband, and 3) services, which includes cloud & managed services and security products.
Shares in Superloop are down 10.65 per cent to $1.72 per share at 11.13am AEST.
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