Troubled Telco AAPT is closer to being taken over by PowerTel with insiders tipping that the 1/2 million dollar deal will be wrapped up by May.
The planned $357 merger between NZ Telcom’s AAPT operation in Australia and PowerTel moved a step closer yesterday when PowerTel shareholders voted to accept the deal. It has already received NZ Government endorsement and PowerTel MD Paul Broad says he expects the merger will be completed early in May.
The deal will see AAPT-PowerTel become Australia’s No 3 carrier behind Telstra and Optus, hopefully increasing market competition. (It will also see the G9 group of would-be fibre-network builders reduced to G8: both outfits are currently members).
The deal puts together AAPT’s Australian retail business with PowerTel’s wholesale business and its independent high-tech 400Gbps Nortel-enhanced longhaul fibre network, which links businesses in Canberra, Melbourne, Sydney and Brisbane.
It has major implications for NZ Telecom, which has suffered major haemorrhaging from the AAPT business. AAPT posted a A$76 million loss last year. Its value had already been written down in TNZ books from more than $1.4 billion to just $270 million and Telecom had failed in many attempts to find a buyer for its Aussie business.
PowerTel earlier this year posted its first annual net profit, of $10 million – compared with an $8 million loss in calendar 2005.
Said Broad yesterday: “Since we announced the acquisition in late January, we have been undertaking the various regulatory and due diligence procedures and today’s approval by shareholders brings us closer to the conclusion. We will now proceed to get the final approval of the Federal Court for the scheme.
“In the meantime, it has been business as usual at PowerTel. We are building on the momentum established in 2006 and our preliminary figures for the first calendar quarter show strong revenue growth with an increase in EBITDA
of 24 percent over last year.”
– In a parallel move, Fairfax Media yesterday announced its merger with Rural Press has been cleared to go ahead.