Megaport to buy Latitude.sh for $459m, confirms $200m equity raise
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More news: Megaport has agreed to acquire compute-as-a-service company Latitude.sh for a fee of up to USD300 million ($459 million).
Megaport has announced a $200 million institutional placement to fund the acquisition and help accelerate its network expansion into India.
The buyout terms for Latitude.sh include an upfront consideration of USD150 million and a contingent consideration of up to USD150 million.
Latitude.sh provides automated, high-performance compute infrastructure that enables customers to scale their workloads.
As part of the acquisition, Megaport said it will establish a new 'compute division' under which Latitude.sh will operate. Latitude.sh's CEO will be appointed as head of the new division, reporting directly to Megaport's CEO.
Megaport said it will also invest around $43 million to accelerate its network expansion in India, including acquiring a network operator with a local team, 400 active customers, 40 data centre locations and annual recurring revenue (ARR) of $6 million.
The company also reiterated its full-year guidance after seeing first-quarter revenue rise 21% year on year to $62.9 million.
What they said: "Megaport has long been trusted by the world's largest enterprises to move workloads seamlessly between data centres and the cloud," said Megaport CEO Michael Reid.
"By bringing Latitude.sh into the fold, we're extending that promise beyond the network - into high-performance, optimised compute."
Megaport enters trading halt ahead of acquisition news
The news: Network-as-a-service provider Megaport has entered a trading halt on the ASX, pending the announcement of a "material corporate acquisition" and a related equity raise.
The numbers: Megaport shares last closed at $15.30, having more than doubled in value since the start of the calendar year.
The context: The company said that the trading halt will remain in place until the earlier of an announcement confirming the completion of the equity raise, and the start of trading on Wednesday.
The source: ASX
