Amcom anticipates further approaches

19/11/2014 - 13:51

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Amcom anticipates further approaches
Amcom Telecommunications chairman Anthony Grist

Amcom Telecommunications is preparing for a busy end to the year as negotiations with Vocus Communications continue and TPG Telecom waits on the sidelines.

Amcom and Vocus entered a confidential due diligence process earlier this month after the latter increased its shareholding to 10 per cent and initiated discussions for a merger.

TPG increased its shareholding to 5.43 per cent around the same time.

No formal approach has been made from TPG, which chairman Anthony Grist said could be an indication of the company waiting for negotiations with Vocus to play out.

“David Teoh (TPG’s executive chairman) is a very canny investor, he sees value really well,” Mr Grist said.

“It’s hard to know where [TPG’s interest] will go, because the process with Vocus is really a process of mutual due diligence and so it’s quite incomplete, we don’t even know where that’s going.

“I’m assuming TPG is watching to make sure it has an input to any outcomes.”

Mr Grist told Business News that, if the negotiations with Vocus resulted in a formal offer being made, it would likely motivate any other interested parties to then make counter offers.

He said the mutual due diligence process between Vocus and Amcom would normally take a few weeks, but expected an outcome before Christmas.

His comments came following Amcom’s annual general meeting, during which chief executive Clive Stein reinforced the company’s strong performance of double digit profit growth.

Its success was further strengthened today with an announcement that Amcom had won a contract worth $6.5 million over four years to supply additional data network services to the Northern Territory government.

Amcom’s share price rose to a new record high of $2.39 following the news this morning.

Mr Stein emphasised the strength of Amcom’s strategy to expand into the east coast, which he said gave the company a bright future regardless of whether a tie-up with another telco occurred.

“We have been working for some time on a strategy to enter the east coast in a more meaningful way,” Mr Stein said.

“Infrastructure ownership now is an opportunity for us and a ‘land grab’ … the market is dynamic and buoyant and there are very many compelling opportunities at our feet.

“If we go it alone we’ve got a great strategy, if we combine there’s some small duplication, but you can never have enough fibre assets.”

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