Australian-regulated OFX terminates acquisition discussions with Western Union over no binding offer

Australian-regulated OFX terminates acquisition discussions with Western Union over no binding offer

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Australia-regulated forex broker OzForex Group, trading as OFX, said on Monday it has terminated all discussions in relation to the previously-announced non-biding offer from US financial services provider Western Union to fully acquire the broker. OFX made the decision since Western Union has not submitted any binding proposal.

OFX announced in November 2015 it had received and evaluated a preliminary non-binding proposal from Western Union to pay $3.50-$3.70 for each one of 240 million OFX ordinary shares via a scheme of arrangements. The US company was to pay up to $90 million in total for the acquisition. It said at the time the discussions are in very early preliminary stage and may not even result in a binding offer.

The broker had granted exclusive due diligence to Western Union after it decided to proceed with the offer. However, after several months of discussions and no binding offer, discussions were ceased.

In addition, OFX said it targets a revenue at $200 million in 2019, which represents a double increase compared to 2015. The broker also expects to generate an earnings before interest, tax, depreciation and amortization (EBITDA) of $35-37 million in fiscal year 2016, ending 31 March, 2016, which is lower than the expectations, but still represents an increase compared to the previous fiscal year.

In December 2015, OFX, previously known as OzForex, initiated a rebranding procedure and launched a new website for Australia. The roll-out started from native Australia and is to be completed in other countries in the first three months of 2016.

The broker operates under tha brands OFX, UKForex, CanadianForex, USForex, NZForex, Tranzfers, ClearFX, but after the rebranding is completed, its operations will be consolidated into a single global brand OFX.

Western Union Company provides global payment services. It operates under the brands Vigo, Orlandi Valuta, Pago Facil and Union Business Solutions.

OFX was set up in 1998 in Sydney. It is regulated by the Australian Securities and Investments Commission (ASIC). It operates offices in Sydney, London, San Fransisco, Hong Kong, Toronto, and Auckland.

Source: OzForex

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