Stargroup (ASX:STL) has raised $3.35 million through the placement of 119.6 million shares priced at $0.028 to sophisticated and professional investors.
Proceeds from the capital raising will be used to finalise the Indue ATM businesses acquisition which will increase group revenues by $4.1 million and EBITDA by $1.7 million.
Completion of the fund raising and acquisition is expected to occur by no later than 5 May 2017.
Todd Zani, CEO, commented: “The $6.5 million purchase price is now fully funded and represents an acquisition multiple of 3.83x forward earnings.
“We are pleased to announce the completion of this capital raise and finalisation of the funding to complete the Indue acquisition.”
Background
Stargroup is a dual listed technology company that owns a 350+ ATM network in Australia and provides EFTPOS and payWave technologies, and has a 11% interest in NeoICP Korea Inc, the manufacturer of cashPod ATMs, back office and casino settlement solutions.
Stargroup offers two key products - ATMs and EFTPOS terminals.
Stargroup is currently completing its acquisition of the ATM switching, settlement processing, telecommunications and ATM reseller business operated by Indue Limited.
Indue provides services to circa 70 ATM deployers, 1,700 ATMs, 1,350 modems and processes 12 million transactions per annum.
March quarter highlights
Stargroup recently posted its 13th record quarter of revenue surpassing $2.5 million for the March quarter.
This represented a 133% increase in 2017 Q3 total revenue compared to 2016 Q3 total revenue.
It also cements a 296% improvement in 2017 year to date total revenue compared to 2016 year to date total revenue.
The Indue acquisition is forecast to further drive revenues moving forward.