Ann: IDX: Replacement Bidder's Statement, page-109

In Nov I posted what I thought about the original IDX deal (it was titled "Food for Thought" - if you want to have a squiz). The reason I mentioned it is because I concluded cash would be tight and they might not be able to pay a divi (which they have albeit a very small one). A couple of things strike me about the recent result and as much as I would like to buy back some CAJ - I won't for the time being - till we get a resolution on the IDX bid. ( IMO - debacle / waste of funds that could have increased the divi or bought back shares for ex).

A couple of things to note IMO -

- The amount of goodwill paid for the two acquisitions is $21.77m (Tassie Radiology) + $3.19m (I-Rad Sunshine Victoria) = $24.967m. Goodwill is the excess of the purchase price over the assets /liabilities etc of the business (see page 18 Interim Financial Report for more detail). We have paid ~$27.67m for the two businesses excluding earn-outs of another $1.5m over the next 2yrs.

- so what's the net cash /debt position now ? CAJ is net cash $5m - "The Company’s current cash balance and debt levels are $85m and $80m ..." - (this is from p2 of the three page release yesterday. )
The increase in debt is due to the acquisitions ie original debt 52.6M+27.7m= 80.3m. This is before any payout for IDX if it proceeds - I guess that will be partly funded by EBITDA and part debt.
Management seem comfy with this but I am not so sure - "• Projected net debt after the Integral Diagnostics takeover will be comfortable at ~1.5x EBITDA " (p4 Presentation).

Anyway enough said - but if I could go back to where we were pre IDX bid (ie net cash ~$45m, share buy-back, increasing margin, possibly larger divi - I personally would in a heart beat !! DYOR

I look fwd to seeing how this plays out.