Vocus Communications confirms acquisition of FX Networks
- 02 July, 2014 10:25
Vocus Communications (ASX: VOC) has confirmed that it will acquire New Zealand-based fibre provider FX Networks for $107.7 million (NZ$115.8 million).
The ASX announcement follows media reports on Monday that Vocus Communications had been in talks with FX Networks for weeks about a sale. Vocus entered a trading halt on the ASX on 30 June.
The FX Networks business is expected to deliver between NZ$13.5 to $14.5 million of Vocus’ earnings before interest, depreciation and amortisation (EBITDA) in the first year following acquisition.
Vocus Communications CEO James Spenceley said Vocus decided to acquire the company to “mirror” its success in Australia as an integrated provider of fibre, Internet and data centre services.
“The FX acquisition adds the missing fibre piece to our existing data centre and Internet investment in New Zealand,” he said in a statement.
In May 2012, Vocus Communications entered a binding agreement to acquire NZ-based data centre and cloud services provider Maxnet for $7.3 million (NZ$9.5 million).
Vocus netted a 580 square metre Tier II data centre in Albany, Auckland and 50 Maxnet staff members.
At the time, Spenceley told Computerworld Australia that the deal was part of the company’s long-term acquisition strategy and desire to extend its New Zealand IP transit operations to include data centre services.
According to FX Networks CEO David Heald, the company owns a “high quality” fibre optic network consisting of 4,132 kilometres of modern ducted fibre cable that covers the North and South Islands of NZ. He added that the company has 365 customers in NZ.
“This transaction allows FX [Networks] to move to the next phase of its corporate development,” Heald said in a statement.
“The addition of Vocus’ financial strength and other NZ assets together with a shared culture focused on delivering exceptional outcomes to customers, means this transaction will give a positive outcome for both shareholders and customers alike”.
Computerworld Australia has contacted Vocus Communications for comment.
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