US company Web.com Group has increased its offer for the company formerly known as Arq Group, raising its bid to $18.9 million.
The now-named Webcentral was approached originally by the technology services company in July with the original offer of 100 per cent of shares for $12.2 million, or $0.10 per share.
A competing offer came from 5G Networks, which offered 1 5GN share for every 12 Webcentral shares at a minimum of 50.1 per cent of its shares, which Webcentral called a “superior proposal” at the time.
However, the latest offer from Web.com now stands at $0.155 per share, which now exceeds that of 5GN.
According to a statement on the Australian Securities Exchange (ASX), Webcentral is still recommending its shareholders to vote in favour of the Web.com scheme.
This agreement would see Web.com refinance Webcentral’s existing debt facilities and repay all of its existing debt, which is priced at an approximate $45.6 million.
As reported by ARN in late August, the publicly-listed Webcentral Group posted a significant loss for its half yearly results, dropping 1,217 per cent, as it faced a customer dispute and deep debt.
Total loss after tax from continuing operations from its singular small- to medium-sized business (SMB) division fell to roughly $18 million in the red, down from the previous corresponding period of $1.6 million in profit.
The drop was in part due to the selling off of its enterprise business — which retained the rights to the Arq Group brand — generating a loss on sale of approximately $1.6 million in the process.
The Web.com proposal is set to be put to a vote on 29 September.