European carrier Colt has agreed to buy Asian information delivery platform KVH for JPY 18.6 billion, or around EUR 130 million.
The deal will be funded by existing Colt cash at hand and committed bank facilities. Colt said the deal will provide it with scale and complementary capability in key Asian cities, namely Tokyo, Singapore, Hong Kong and Seoul, and give a platform for the company to enter the APAC ICT services market, which is growing at around 12 percent per year. The transaction will also enhance Colt’s competitive position in serving multi-national customers (MNCs) and so provide attractive opportunities for growth.
Colt expects the acquisition to deliver annual cost and capex synergies of EUR 8.5 million by 2017 and contribute to earnings and cash flow from 2016.
KVH is fully owned by FMR, FIL and their associates. FMR, FIL and certain of their associaties are also shareholders of Colt. The deal therefore constitutes a related party transaction which is subject to the approval of independent shareholders. Colt will therefore hold an AGM on 16 December in order to seek approval.