Craig-Hallum Capital Group LLC is acting as the sole book-running manager and B. Riley FBR, Inc. is acting as a co-manager for Fusion (FSNN), a leading provider of cloud services, underwritten registered public offering which contemplates to offer and sell approximately $30.0 million of shares of common stock.
The proposed offering is being made pursuant to a shelf registration statement on Form S-3 (File No. 333-222127) that was declared effective by the U.S. Securities and Exchange Commission (the “SEC”) on January 17, 2018. A preliminary prospectus supplement and accompanying prospectus relating to and describing the terms of the proposed offering have been filed with the SEC and may be obtained by visiting the SEC’s website at www.sec.gov.
In addition, Fusion expects to grant the underwriters a 45-day option to purchase up to an additional 15% of the shares of its common stock sold in the offering to cover over-allotments, if any
Note that pursuant to an amendment to Fusion’s Agreement and Plan of Merger with Birch Communications Holdings, Inc., dated January 25, 2018, any shares sold in this offering, if completed, will not be counted as issued and outstanding for purposes of calculating the number of shares of Fusion common stock to be issued as consideration to the Birch shareholders in connection with the closing of the merger. As a result, on a post-closing basis, the dilutive effect of this offering will be shared pro rata by current Fusion and Birch shareholders with current Fusion shareholders bearing approximately 25% of the dilution and current Birch shareholders bearing approximately 75% of the dilution from this offering.
Matthew Rosen, New York, NY based Cloud Services Provider Fusion’s (NasdaqCM: FSNN) CEO stated with the release of their Q3 results Novemebr 13, 2017, “Fusion continued to deliver solid financial performance during the third quarter of 2017, with nearly 40% growth in Business Services revenue and nearly 150% growth in Adjusted EBITDA, thanks to the contribution from the Apptix acquisition as well as solid sales bookings and installations, customer novations, and continued low churn. These results clearly demonstrate the power of our compelling strategy as the single source for the cloud. Since we announced our definitive agreement to acquire the Cloud and Business Services business of Birch in late August, both companies have been planning for the integration of our people, products, networks, and systems to ensure that the combined company – which will be one of the largest cloud services providers in North America – is positioned to begin realizing the benefits of the combination immediately after closing. We have also made substantial progress on the steps required to complete the transaction, including antitrust filings and filings with the FCC and a number of state regulatory agencies, and we expect to file the preliminary proxy this week. Given the upcoming holiday season, we believe that the process of obtaining regulatory approvals will take the close of the acquisition into the first quarter of 2018.”
Michael Bauer, Fusion’s CFO, stated, “We are very excited to complete the Birch transaction. The combined company is projected to have approximately $575 million in pro forma annual revenue and over $150 million in pro forma annual Adjusted EBITDA, including over $20 million in expected cost synergies.”
To learn more about Fusion (Nasdaq: FSNN) and to track its progress please visit the Vista Partners Fusion (FSNN) Coverage Page.
FSNN closed Friday’s trading at or $3.48 off of its 52-week high of $4.42 but significantly higher than its 52-week low of $1.11. FSNN now averages 387,753 shares a day.