G Invacom

G Invacom (Previously Radiance Grp): RTO debuts today. Global Invacom is a privately held UK-based satellite equipment co formed in 2008 from the merger of Global Coms and Invacom and is one of 7 co’s in the world involved in R&D, design and supply of satellite components and products to large scale satellite broadcasters. To date, it has filed 31 patent applications and invested US$13.8m in R&D between 2009 and 2011. Current clients include BSkyB of UK and Dish Network of US. Base size of 41.5m new shares as compliance placement ($12.8m) and 18.1% of enlarged share base. Placement price: $0.3087 Total paid share capital of 290m shares ($78.7m) Discount to last close @ $0.41 = 24.7% P/E (FY11) = 6.0x EV/EBITDA (FY2011) = 2.6x P/B = 1.27x Use of Proceeds: Investment and acquisition activities: $7m R&D: S$2m General working capital purposes: $225,000 Expenses: S$3.6m Growth potential: Switch from Terrestrial TV and cable to Satellite TV. (22% growth rate since 2008) Penetration into new and growing markets such as Asia Pacific and marine Sat comms (30-40% revenue growth). Vertical Integration: The merger will combine GIHL's Sat Comms R&D and sales units with Radiance's manufacturing operations, providing synergies and improving efficiency. The acquisition of GIHL marks a major transition in the strategic direction of the Grp going forward. The enlarged group will reap benefits and form synergies from integrating the supply chain and other operations and resources of the EMS and the GIHL businesses, and has outlined a strategy to expand its business in the Asia Pacific as well as sub-sectors within the global Satcom business. The Group is cautiously assessing the impact of the looming global economic uncertainty but remains optimistic on the benefits leveraged from the merger, new opportunities in Asia Pacific and its ability to penetrate and offer value-added propositions to the marine and other Satcom sub-sectors. Small freefloat of approx 20%. The remaining shares are mostly held by major shareholders and associates. 180 day lockup period for company and selling shareholders.