AG FINANCIAL PUTS BUYOUT TO THE VOTE

Written on the 21 July 2014 by Nick Nichols

AG FINANCIAL PUTS BUYOUT TO THE VOTE

AG FINANCIAL Ltd (ASX: AHA) is finally progressing its planned $2 million acquisition of financial services company Avestra.

The deal, which was announced in April last year, is set to go to a shareholder vote at an extraordinary general meeting to be held at AG Financial’s Broadbeach Waters headquarters on August 21.

The deal will be funded by issuing Avestra, which is controlled by Clayton Dempsey, with 57.1 million AG Financial shares at 3.5c each.

Avestra supplies trading services to clients across trading a range of financial instruments, including options, CFDs and foreign exchange.

AG Capital chairman James Schwarz says these services align closely with AG Financial’s business activities in marketable securities services.

Following the deal, Avestra Asset Management will hold 24.8 per cent of AG Financial, and this has triggered the need for shareholder approval of the deal.

AG Capital has been working on a buyout deal for Avestra since the beginning of last year, with the proposal originally involving a placement of 150 million AG shares and the conversion of $430,000 of short-term debt funding provided by DJ Capital Solutions into equity.

AG instead opted to raise $2.8 million through a rights issue underwritten by Avestra in June last year.

This brought Avestra on to the share register as a substantial shareholder.

AG Financial has enlisted independent expert RSM Bird Cameron Corporate to assess the Avestra acquisition, saying it is the best means for fast tracking future growth for the company.

It is planning to raise a further $750,000 for working capital through the issue of 12.5 million shares at 3c each to Merill Capital, a company registered in the United Arab Emirates, and Shariott Investments, a company registered in the British Virgin Islands.

AG Financial, which debuted on the ASX in 2007 as Fox Invest Limited and later renamed Excela Ltd, was headed by Peter Spann until March last year when he resigned as executive chairman and sold his remaining shares in the company.

The company, which relocated to the Gold Coast from Brisbane late last year, has a long history of trading losses.

The independent expert’s report says that should the Avestra transaction fail to be approved, AHA could need further funding.

Shares in AG Financial last traded at 4.5c each.

Author: Nick Nichols

Latest News

SIRTEX CEO DISMISSED FOLLOWING SHARE TRADING PROBE

SIRTEX Medical Ltd (ASX: SRX) has sacked its chief executive officer, Gilman Wong (pictured), following an investigat...

SANTA DELIVERS KOGAN A GIFT

KOGAN.COM (ASX: KGN) has exceeded its expectations and reported another strong quarter of trade.

The online retail...

FOUR WAYS YOU SHOULD PROTECT YOUR IT SYSTEMS FROM EXTREME WEATHER

SHANNON Overs, co-founder of onPlatinum ICT, sees it too often, perhaps half a dozen times per year businesses tha...

IOT GROUP ORDERS FIRST PRODUCTION OF ROVA DRONE

IOT Group (ASX:IOT) has ordered production of 40,000 units of the ROVA flying selfie drone from Chinese technologies ...

Related News

RISE OF STARTUP SUPPORT PROGRAMS NOT AS ROSY AT IT SEEMS

ENTREPRENEURIAL cultivation companies in Australia are appearing quickly, but questions have been raised about whe...

SMES TAKE RETAIL MARKET SHARE AS CONSUMERS CHOOSE PERSONALISATION

IN a battle for the hearts and wallets of Australian consumers, it appears that small and medium retail businesses...

KNOWLEDGE WORKERS AMONG MOST SOUGHT AFTER IN 2017

BUSINESSES searching for efficiencies and improved systems are in search of knowledge workers early this year, say...

FEMALE ENTREPRENEURS GET SPRINGBOARD TO GROWTH

DESPITE the fast-growing number of women studying STEM subjects at school and university, women continue to be und...

Contact us

Email News Update Sign Up Contact Details
Subscriptions

PO Box 2087
Brisbane QLD 4001

LoginTell a FriendSign Up to Newsletter