CAPITAL STACK ISSUE #14

Good Morning,

Welcome to this week's edition of the CAPITAL STACK Newsletter.

The Framework

EV versus equity value

Enterprise value is the value of the operating business before deciding who gets paid. Equity value is what belongs to shareholders after adjusting for debt, cash and surplus or non-operating assets.

A simple bridge is:

Enterprise value
less net debt
plus surplus assets
equals equity value

This detail matters in a transaction as a headline share price is usually equity value language. Buyers and advisers still spend most of their time thinking in enterprise value terms because that is where the operating business, debt, working capital and surplus assets are reconciled.

Simple worked example

Assume a target has:

Enterprise value: A$150 million
Net debt: A$12 million
Surplus assets: A$16 million
Shares on issue: 119 million

Equity value = A$150 million less A$12 million plus A$16 million = A$154 million.
Equity value per share = A$154 million / 119 million shares = A$1.29 per share.

That is close to how the SDI independent expert’s bridge works. RSM assessed SDI enterprise value at A$139.4 million to A$159.6 million, deducted A$12.3 million of net debt, added A$16.2 million of surplus assets, and produced an equity value range of A$1.21 to A$1.38 per share

This Week in Deals

Regis Resources and Vault Minerals agree gold merger

Type: Scheme / all-scrip merger
Headline Value: A$10.7 billion pro forma market capitalisation
Who: Regis Resources / Vault Minerals
Advisors: Regis: Goldman Sachs, Azure Capital and Mallesons. Vault: RBC Capital Markets and Corrs Chambers Westgarth.
Date of announcement: 5 May 2026
Detail: Regis and Vault agreed an all-scrip merger to create a larger ASX-listed gold producer.

Central Asia Metals to acquire Cygnus Metals

Type: Scheme / all-scrip metals acquisition
Headline Value: A$232 million implied fully diluted equity value
Who: Central Asia Metals / Cygnus Metals
Advisors: CAML: BMO Capital Markets, Corrs, McCarthy Tétrault and Fieldfisher. Cygnus: Canaccord Genuity, Hamilton Locke and Osler.
Date of announcement: 2 June 2026
Detail: CAML will acquire Cygnus and its Chibougamau copper-gold project, with Cygnus holders owning 30% of the enlarged group.

SDI Limited progresses cash scheme with InnoXvest Dental

Type: Scheme / cash takeover
Headline Value: A$166.4 million equity value
Who: InnoXvest Dental / SDI Limited
Advisors: SDI: Houlihan Lokey, DLA Piper and RSM. Sinocera: Rothschild & Co and HSF Kramer.
Date of announcement: 18 May 2026 scheme booklet registration
Detail: SDI shareholders are being offered A$1.40 per share in cash under a recommended scheme.

Atlantic Lithium enters binding scheme with Huayou

Type: Scheme / cash takeover
Headline Value: US$210 million, approximately A$292 million
Who: Zhejiang Huayou Cobalt / Atlantic Lithium
Advisors: Atlantic: Canaccord Genuity and HopgoodGanim. Huayou: HSF Kramer.
Date of announcement: 7 May 2026
Detail: Huayou agreed to acquire Atlantic Lithium for cash, gaining control of the Ewoyaa lithium project.

Energy Fuels advances Australian Strategic Materials scheme

Type: Scheme / scrip acquisition
Headline Value: Approximately A$447 million implied value
Who: Energy Fuels / Australian Strategic Materials
Advisors: Energy Fuels: Goldman Sachs, HSF Kramer, Dentons Canada and Dorsey & Whitney. ASM: MA Moelis, Moelis & Company and A&O Shearman.
Date of announcement: 18 May 2026 scheme booklet registration
Detail: Energy Fuels is progressing its proposed acquisition of ASM to build a larger rare earths and critical minerals platform.

Matrix Composites scheme moves to shareholder vote

Type: Scheme / cash takeover
Headline Value: A$0.40 per Matrix share
Who: Advanced Innergy Holdings / Matrix Composites & Engineering
Advisors: Matrix: Azure Capital, Gilbert + Tobin and BDO.
Date of announcement: 4 June 2026 scheme booklet registration
Detail: Matrix shareholders are scheduled to vote on the proposed cash scheme in July.

Ampol clears ACCC hurdle for EG Australia acquisition

Type: M&A / regulatory approval
Headline Value: A$1.1 billion
Who: Ampol / EG Australia
Advisors: Ampol: HSF Kramer for ACCC clearance. Investment bank advisors not disclosed.
Date of announcement: 3 June 2026
Detail: The ACCC approved Ampol’s acquisition of EG Australia, subject to divestment of 41 retail fuel sites.

Perpetual sells Wealth Management business to Bain Capital

Type: Private equity carve-out
Headline Value: A$500 million upfront, plus potential additional payments
Who: Bain Capital / Perpetual Wealth Management
Advisors: Perpetual: Barrenjoey and King & Wood Mallesons. Bain advisors not disclosed.
Date of announcement: 16 March 2026, with May 2026 update
Detail: Perpetual is selling its Wealth Management business to Bain Capital as part of a broader simplification strategy.

Ordermentum secures investment from Five V Capital

Type: Private equity growth investment
Headline Value: A$55 million
Who: Five V Capital / Ordermentum
Advisors: Barrenjoey ran the process. Legal advisors not disclosed.
Date of announcement: 22 May 2026
Detail: Five V invested in Ordermentum to support growth across hospitality ordering, payments and supplier workflows.

Healius explores sale of Agilex Biolabs

Type: Sale process / strategic review
Headline Value: Undisclosed
Who: Potential buyers / Healius
Advisors: Healius: UBS Securities Australia.
Date of announcement: 13 May 2026
Detail: Healius appointed UBS to explore a potential sale of Agilex Biolabs after receiving unsolicited interest.

Megaport launches entitlement offer for AI infrastructure contracts

Type: Capital raising
Headline Value: A$827.3 million entitlement offer
Who: Eligible shareholders / Megaport
Advisors: UBS Securities Australia and Merrill Lynch Equities Australia.
Date of announcement: 3 June 2026
Detail: Megaport launched a large equity raising to fund contracted AI infrastructure and network capex.

Airwallex raises new growth funding

Type: Growth funding
Headline Value: Reported valuation around US$12 billion
Who: Addition-led investors / Airwallex
Advisors: Not disclosed
Date of announcement: 28 May 2026
Detail: Airwallex raised new capital at a reported US$12 billion valuation.

Oli raises Series A3 funding

Type: Venture funding
Headline Value: A$6.5 million
Who: Scale Investors, Clare Ventures and University of Sydney-linked investors / Oli
Advisors: Not disclosed
Date of announcement: 26 May 2026
Detail: Oli raised capital to support its maternal and foetal monitoring technology.

Scottish Pacific exit process moves towards IPO option

Type: Sponsor exit / private credit platform process
Headline Value: Not disclosed
Who: Potential buyers or IPO investors / Affinity Equity Partners
Advisors: UBS reportedly ran the data room and strategic review process.
Date of announcement: May 2026 report
Detail: Affinity is reportedly considering an IPO for Scottish Pacific after sale talks did not clear valuation expectations.

Capital Stack's View

SDI Limited progresses cash scheme with InnoXvest Dental

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Eligible SDI shareholders receive A$1.40 per share in cash, valuing SDI’s equity at about A$166.4 million. If implemented, InnoXvest will acquire 100% of SDI, SDI will become a wholly owned subsidiary, and SDI will be removed from the ASX.SDI is a Victorian-based dental materials manufacturer.
​
The company develops, manufactures and distributes restorative dental products, including composites, glass ionomers, adhesives, cements, tooth whitening systems and amalgam products. Most of its products are manufactured at Bayswater, Victoria, and distributed across more than 100 countries.
​

RSM assessed future maintainable EBITDA at A$20.5 million to A$21.0 million and applied a 6.8x to 7.6x control EBITDA multiple, producing enterprise value of A$139.4 million to A$159.6 million. After deducting A$12.3 million of net debt and adding A$16.2 million of surplus assets, RSM arrived at an equity value range of A$1.21 to A$1.38 per share. The A$1.40 bid sits at a slight but reasonable premium to that range.
​
SDI has historically been a global leader in amalgam, but amalgam is being phased out in many markets due to mercury regulation. The company is trying to shift that customer base towards newer products, including Stela, its mercury-free restorative replacement. The FY25 sales mix across aesthetics, whitening, amalgam and equipment shows both the risk and opportunity. Amalgam represented 13% of FY25 revenue, while aesthetics and whitening represented 52% and 29%, respectively. The legacy product is declining, but the non-amalgam categories are already the larger part of the business.
​

The standalone business is profitable, FY25 revenue was A$110.4 million, EBITDA was A$21.3 million and NPAT was A$12.2 million. HY26 EBITDA was A$8.5 million on A$52.9 million of revenue, implying a lower margin than FY25. That makes the all-cash certainty more meaningful in this deal.
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InnoXvest is clearly paying for a specialised manufacturing base, a global distribution footprint, regulatory access, product know-how and the ability to fold SDI into a larger dental materials platform.

Capital Transitions

Selected recent insolvency and capital transition signals that may intersect with deal flow or special situations:
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​Liberty Bell Bay sale process​
​

Industry: Aluminium / industrials
Appointment: Administration, with EY administrators reported to be progressing a sale process
Why it matters: A capital-intensive industrial asset is being worked through a special situations sale process with government and lender relevance.
Date of appointment or announcement: May 2026 sale update
​

Carbon Revolution restructuring​
​

Industry: Advanced manufacturing / automotive components
Appointment: Administration and DOCA-led ownership transfer to OIC
Why it matters: The restructure shows secured creditor control converting debt exposure into ownership where public equity could not support the balance sheet.
Date of appointment or announcement: May 2026 update
​

Winemasters SA receivership​
​

Industry: Wine processing / agribusiness
Appointment: KPMG receivers appointed after Bendigo Bank action, with administrators also appointed
Why it matters: The process creates a potential asset sale or white knight recapitalisation situation in a stressed agribusiness asset.
Date of appointment or announcement: May 2026 report
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​Dexus / APAC forced stake sale risk​
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Industry: Infrastructure / airports / private capital
Appointment: Not an insolvency appointment. Court-triggered capital transition following a shareholder default dispute.
Why it matters: The decision could force the sale of Dexus-managed interests in Melbourne Airport, making governance breaches a direct capital event.
Date of appointment or announcement: NSW Supreme Court judgment on 29 May 2026, commentary published 2 June 2026
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​Barbeques Galore DOCA fails, winding-up process to follow​
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Industry: Retail / consumer discretionary
Appointment: Grant Thornton administrators and Ankura receivers and managers were appointed on 12 February 2026. The failed DOCA and winding-up transition became the relevant June capital transition.
Why it matters: A secured-creditor backed recapitalisation failed, leaving remaining value to be realised through store closures, asset sales, stock liquidation and franchise transition arrangements.
Date of appointment or announcement: 8 to 9 June 2026 update, winding up effective 16 June 2026
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​Nathan River Resources enters voluntary administration​
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Industry: Iron ore / mining
Appointment: BRI Ferrier appointed as administrators to five companies in the Nathan River Resources group in late May 2026.
Why it matters: A Northern Territory iron ore asset with more than A$300 million of reported obligations is now a mining special situations process.
Date of appointment or announcement: Appointment in late May 2026, reported 9 June 2026
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CAPITAL STACK​
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Market summaries are AI-assisted and may contain errors.
This is general information only, not financial advice.

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