Comms Group Raises $7M at $0.05 Per Share to Acquire TasmaNet

Capital Raising to Support Strategic Acquisition

Comms Group Ltd (ASX: CCG) has announced a fully underwritten non-renounceable entitlement offer alongside a placement to raise approximately $7 million. This capital raising is designed to fund the acquisition of TasmaNet Pty Ltd, a leading Tasmanian provider of premium data communication and managed IT services.

The entitlement offer allows eligible shareholders in Australia and New Zealand to subscribe for 1 new share for every 9 shares held at an issue price of $0.05 per share. The offer is fully underwritten by joint lead managers Henslow Pty Ltd and Taylor Collison Limited, ensuring the company secures the targeted funds regardless of shareholder uptake.

Transformational Acquisition of TasmaNet

The $10 million acquisition of TasmaNet is expected to be transformational for Comms Group. TasmaNet operates one of Tasmania’s largest fixed wireless broadband networks and owns significant fibre optic infrastructure in Hobart and Launceston. Its customer base includes over 600 government and business clients, with approximately 40% of revenue derived from long-standing contracts with 29 Tasmanian government departments.

This acquisition aligns with Comms Group’s strategy to expand its managed IT and cloud services footprint, particularly in government and corporate mid-market sectors. The addition of TasmaNet’s assets and customer relationships is projected to increase Comms Group’s proforma annualised revenue to around $75 million and underlying EBITDA to between $9 million and $10 million.

Financial and Strategic Implications

Comms Group’s standalone FY25 guidance remains at $55 million to $57 million in revenue and $5 million to $6 million in EBITDA. The acquisition and capital raising will significantly enhance these figures, with TasmaNet contributing approximately $19 million in annualised revenue and $4 million in EBITDA. The acquisition is expected to be immediately earnings accretive, with a purchase price representing roughly 2.5 times annualised EBITDA.

The capital raising comprises a $4.8 million placement to institutional investors and a $2.2 million entitlement offer to existing shareholders. The offer price represents a discount of approximately 16.7% to the last closing price, reflecting a strategic pricing to encourage participation and ensure full subscription.

Risks and Considerations

While the acquisition offers significant growth potential, Comms Group acknowledges risks including integration challenges, completion conditions, and potential undisclosed liabilities given TasmaNet’s sale by receivers. The entitlement offer is non-renounceable, meaning shareholders who do not participate will face dilution of their holdings by approximately 9%, on top of the 25% dilution from the placement.

Comms Group has secured a $10.7 million debt facility from Regal Funds Management to support the acquisition and refinance existing debt, further underpinning the transaction’s financing structure.

Next Steps for Shareholders and Market

The entitlement offer opened on 22 May 2025 and closes at 5:00 pm Sydney time on 2 June 2025. Eligible shareholders are encouraged to review the detailed offer booklet and consider their participation carefully. The acquisition completion is expected by the end of May 2025, subject to standard conditions including third-party consents.

Comms Group’s move to expand its service capabilities and geographic reach through this acquisition and capital raise marks a significant milestone in its growth trajectory, positioning it for enhanced competitiveness in the Australian managed IT and cloud communications market.