Webjet Group (ASX: WJL) Receives A$0.90 Per Share Takeover Offer from Helloworld Travel (ASX: HLO)

In significant ASX WJL news, Helloworld Travel Limited (ASX: HLO) has put forward a non-binding proposal to acquire all remaining shares in online travel agency Webjet Group Limited (ASX: WJL). The Helloworld Webjet acquisition offer proposes an all-cash consideration of A$0.90 per share, which would be implemented through a scheme of arrangement. Helloworld, which already holds a substantial 17.27% stake in Webjet, is seeking to acquire the outstanding 82.73% of the company.

The proposal includes a notable provision for shareholders. Webjet’s recently announced A$0.02 per share dividend for 1H26 will not be deducted from the cash consideration. This structure allows shareholders to retain the full value of both the declared dividend and the offer price, an important detail in any Webjet takeover scenario.

At this stage, no immediate action is required from Webjet shareholders. The Webjet Board has granted Helloworld access to conduct due diligence, a necessary step before the proposal can become a formal, binding offer. This period allows Helloworld to thoroughly assess Webjet’s financial and operational standing.

What are the key terms of the Helloworld Webjet acquisition offer?

The proposed transaction is structured as a scheme of arrangement, a court-supervised process common in Australian public M&A. This method requires approval from 75% of votes cast and 50% of shareholders voting. If these thresholds are met and the Court provides its sanction, the deal becomes binding on all shareholders.

The headline offer is a cash payment of A$0.90 per share. Shareholders will need to evaluate this price in the context of Webjet’s recent market performance, financial results, and future growth outlook. Helloworld’s existing 17.27% shareholding provides a significant advantage, as it creates a foundational voting bloc in favour of the proposal.

Transaction Structure Summary

Is the Webjet takeover a good deal for shareholders?

Assessing the merits of the offer requires careful consideration of several factors. The all-cash nature of the Helloworld Webjet acquisition offer provides certainty and immediate liquidity for shareholders, removing any risk associated with share price fluctuations of the acquiring entity.

The offer’s value of A$0.90 per share should be compared against Webjet’s standalone valuation. Investors may wish to analyse recent trading prices, analyst price targets, and the company’s performance in the recovering travel sector. The inclusion of the A$0.02 per share dividend on top of the offer price is a clear benefit, enhancing the total return for shareholders.

However, the proposal is currently non-binding. Its progression is subject to several conditions, including the completion of due diligence and the negotiation of a binding Scheme Implementation Deed. An independent expert will also be appointed to assess whether the offer is fair and reasonable and in the best interests of Webjet shareholders.

What conditions must be met for the Helloworld acquisition to proceed?

The transition from an indicative proposal to a completed transaction is contingent on several key conditions. The Helloworld acquisition of Webjet faces material hurdles, and there is no guarantee that a binding deal will eventuate.

Due diligence is the most immediate condition. Helloworld must conduct a satisfactory review of Webjet’s finances, operations, and legal standing. Following this, both parties must execute a Scheme Implementation Deed (SID), which formalises the terms of the transaction.

The proposal also requires a unanimous recommendation from the Webjet Board, which would be conditional on no superior proposal emerging. Furthermore, regulatory bodies, likely including the Australian Competition and Consumer Commission (ACCC), will need to provide approval for the transaction to proceed.

Key Conditions and Investor Implications

How will Helloworld finance the Webjet acquisition?

Helloworld has indicated that the funding for the acquisition will be sourced from a combination of its existing cash reserves and new debt facilities. This financing structure has important implications.

By avoiding an equity raising, Helloworld will not dilute its existing shareholders to fund the transaction. However, taking on new debt will increase the company’s leverage. Investors in Helloworld will need to assess the impact of this increased debt on the company’s balance sheet and future financial flexibility.

For Webjet shareholders, this cash-and-debt funding model provides a high degree of certainty that funds will be available for payment should the scheme be approved. It removes the financing risk that can sometimes complicate takeover offers.

Execution Risk Warning

There is no certainty that the Helloworld Webjet acquisition offer will result in a binding proposal or a completed transaction. Investors should not assume deal completion at the announced terms and await further ASX announcements.

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