Amcom Telecommunications has acquired a high-speed data competitor by paying $6.25 million for the Perth business of People Telecommunications Ltd.
People Telecom operates the Perth data business once controlled by Chris Gale’s Swiftel, which includes broadband infrastructure servicing the central business district and a 600 square metre data centre.
Amcom’s shares were put in a trading halt last week, four days after the company revealed that Futuris Corporation managing director Les Wozniczka had been appointed to its board, sparking industry speculation of a full-scale takeover of Sydney-based People Telecommunications, which went into a trading halt on the same day.
However, Amcom resurfaced two days later to reveal it was only taking over the Perth operations.
One industry source said Amcom was effectively taking out a competitor because, like People Telecom, Amcom also had a fibre network that serviced the CBD.
Amcom chief operating officer Clive Stein said the acquisition would increase the company’s fibre business revenue by 25 per cent. Mr Stein, who will replace outgoing Amcom managing director Eddy Lee on September 1, added that People Telecom’s Perth business would generate sales revenue of $6 million and provided earnings before interest, depreciation and amortisation of $2 million per year.
“We see this as a strategic whole-of-business acquisition consolidating our position in the Perth corporate data market,” Mr Stein said. “The addition of this client base and infrastructure will provide opportunities to sell new products and expand our revenues.”
Last month, Amcom revealed its net profit for the half-year to December had risen 200 per cent from $800,000 to $2.3 million.
The result was helped by a 49 per cent increase in sales to $18.9 million, as well as earning $1.4 million from its 20 per cent stake in iiNet Ltd.
Amcom’s fibre division recorded a sales jump of 48 per cent to $13.8 million and EBITDA increasing 18 per cent to $5.3 million.
