TPG plays for Amcom

06/11/2014 - 15:37


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TPG plays for Amcom

Interest in a takeover of Perth-based Amcom Telecommunications is heating up with telecommunications heavyweight TPG Telecom emerging as a potential suitor.

TPG Telecom, which has a market value of $5.9 billion, today revealed it has spent close to $9 million buying shares in Amcom to take its holding to 5.43 per cent of the company.

It follows an announcement last week by east coast-based Vocus Communications that it had increased its stake in Amcom to 10 per cent and proposed a potential merger of the two businesses.

Both Amcom and Vocus hold significant telecommunications fibre networks, and Amcom announced on Monday that it had increased its fibre assets through the acquisition of 180 kilometres of fibre running through Sydney, Brisbane and Melbourne.

The two companies have been continuing discussions this week with Amcom indicating interest in a merger.

It’s thought Amcom’s acquisition of fibre on the east coast and its announcement of an east coast expansion strategy at the same time would only strengthen Vocus’s rationale for a tie-up.

Today’s announcement that TPG had also upped its stake in Amcom drove the latter’s share price up more than 6 per cent to a new record high of $2.51 today.

Its shares are now sitting 28 per cent higher than before Vocus announced its interest in a tie-up.

TPG began its buying spree last Friday, before which its shares represented just less than 4 per cent of the shares on issue.

A merger with TPG would create a company valued at $6.5 billion, compared to the $1.2 billion valuation placed on an Amcom-Vocus merger.

Analysts last week indicated that other telecommunications parties were likely to throw their hats in the ring to take over Amcom’s assets, with TPG being an expected player.

iiNet and the Nextgen Group are the other telecommunications companies thought to be interested in acquiring Amcom due to its telecommunications networks. 


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