SYDNEY, AUSTRALIA: Cardno Limited (ASX: CDD) has entered into a share purchase agreement for the sale of 100% of Cardno International Development for an enterprise value of AUD $56.5 million.
The agreement is signed with with DT Global Australia Pty Ltd, which is a subsidiary of DT Global L.P. Cardno International Development comprises of Cardno Emerging Markets (Australia) Pty Ltd, Cardno UK Limited and Cardno Emerging Markets USA Ltd.
The entities forming part of Cardno International Development are being sold on a cash-free, debt-free basis. The Transaction is subject to usual net working capital and net debt adjustment mechanisms.
Following completion of the Transaction, Cardno intends to distribute approximately AUD$56.5m to Cardno Shareholders, equivalent to $1.45 per share.
The proposed distribution will be a mixture of a capital return and an unfranked dividend. Confirmation as to the split of the distribution will be determined in the coming weeks. Cardno will communicate the expected characteristics of the distribution to Shareholders as soon as it has been finalised.
Cardno expects to retain more than AUD$15m of cash after paying all transaction costs and the distribution to Shareholders. AUD$5m may be placed in escrow for 2 months following completion of the Transaction if DT Global does not procure a buy-side Warranty & Indemnity insurance (W&I) policy relating to Cardno International Development prior to completion of the Transaction. The remaining cash will be retained to fund ongoing cash flow requirements.
The acquisition of Cardno International Development by DT Global is the result of an extensive global strategic review, as formally announced to ASX on 15 November 2021. This strategic review saw a number of international development groups conduct due diligence and allowed the Cardno Board considerable price discovery as to the value of Cardno International Development.
On 15 November 2021, Cardno formally announced that it would continue its strategic review of its remaining operations including Cardno International Development, with the objective of maximising Cardno Shareholder value. Over the past 4 months, Cardno has conducted a global review of its activities and has received multiple offers for Cardno International Development.
The Cardno Board has unanimously decided that the offer received from DT Global for Cardno International Development reflected in today’s announcement represents the best available option to maximise Shareholder value.
Michael Alscher, Cardno’s Chairman, stated: “Cardno International Development has played an important role in the delivery of practical, innovative and sustainable solutions in international development for more than 50 years.
We would like to thank the management team and staff of Cardno International Development for their work in helping Cardno become a market leader known for its breadth of expertise.
The transaction with DT Global not only represents an attractive financial outcome for Cardno Shareholders but also ensures DT Global will continue delivering the important work of Cardno International Development, backed by their more than 60 years’ experience in supporting aid and development imperatives globally.”
Comments from DT Global Chief Executive Officer Torge Gerlach, DT Global’s Chief Executive Officer, stated: “We are looking forward to this opportunity to combine the skills and expertise of DT Global and Cardno International Development so that we can create impact and transform lives together.
Building on our 50 plus years of experience and our global network of technical experts, Cardno International Development’s future integration into DT Global serves as a tremendous opportunity to provide superior global offerings for our clients and stakeholders.
We are excited by the possibilities this combination can deliver, and we look forward to welcoming our Cardno International Development colleagues into the DT Global family.”
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