Creates the leading trans-Tasman Telco
Vocus Communications Limited (ASX: VOC) is pleased to announce it has entered into agreements with the shareholders of FX Networks Limited (FX) to acquire 100% of the issued capital of the New Zealand fibre provider.
FX owns a unique and high quality fibre optic network consisting of 4,132 kms of modern ducted fibre cable covering both the North and South Islands of New Zealand. The company has 365 customers including 43 of the Top 100 companies in New Zealand.
Vocus will acquire FX for an enterprise value of NZ$115.8m (~A$107.7m). The FX business is expected to deliver NZ$13.5-$14.5m of EBITDA in the first 12 months post acquisition (excluding transaction and integration expenses).
The combination of Vocus and FX strengthens both businesses. Vocus will emerge as the third largest network operator in NZ and the clear leader in trans-Tasman telecommunications and data centres.
Vocus CEO, James Spenceley said, “FX has built an excellent fibre asset reaching all major population centres across New Zealand. There exists an exciting opportunity in New Zealand to mirror the success we have had in Australia as the only integrated provider of fibre, Internet and data centres. The FX acquisition adds the missing fibre piece to our existing data centre and Internet investment in New Zealand”.
FX CEO, David Heald said, “This transaction allows FX to move to the next phase of its corporate development. We have fundamentally completed the build of New Zealand’s most modern fibre network. 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”.
The acquisition is fully funded funded via current cash holdings, a new multicurrency senior debt facility with the Commonwealth Bank of Australia and Vocus scrip issued to FX shareholders. FX shareholders may accept a combination of shares and/or cash (up to a cap of NZ$20.5m). Depending on acceptances by FX shareholders, Vocus will issue between 8.8m – 13.1m shares issued at A$4.40 per share, a 5% discount to the 5 day VWAP and a 1.3% premium to the 30 day VWAP prior to 30 June 2014.
The structure of the financing will provide Vocus with an additional unused debt facility of circa A$40m to continue to seek growth opportunities.
Vocus has received agreements from 77.1% of FX shareholders indicating they will accept the offer and the transaction is expected to complete early Q2 FY2015.
Formal process and indicative timing
Completion of the FX acquisition will be subject to a number of conditions precedent including (but not limited to):
• Vocus shareholder approval for the purposes of ASX Listing Rule 7.1, to be obtained at an EGM scheduled to be held in late August 2014, with a notice of meeting to be despatched in late July 2014
• Acceptances by more than 90% of FX shareholders of the offer:
• Takeover Offer Document, Target Company Statement and Independent Expert’s Report released in late August 2014
• 50% of the shares issued to FX shareholders being subject to escrow conditions
• Receipt of change of control consents from certain key commercial counterparties
• No event having occurred under Vocus’ funding arrangements which would allow Commonwealth Bank of Australia to withdraw its funding commitment to Vocus
For more information: James Spenceley
Chief Executive Officer
T: 02 8999 8999
About Vocus (ASX:VOC): Vocus Communications is an ASX listed leading telecommunications provider of Data Centre, Dark Fibre and International Internet connectivity across Australia, NZ, Singapore and the US. The company provides high performance, high availability, and highly scalable communications solutions, which allow service providers to quickly and easily deploy new services for their own customer base.
A new initiative designed to improve customer experience and internal efficiencies is Service Now*.
To be released later this month (July 2014), this new ticketing and workflow platform incorporates a fully integrated system that streamlines the process around support and provisioning.
A major leap forward comes in the content and relevance of our customer notifications. With Service Now, we can now provide highly targeted, detailed descriptions about any hazardous work, incidents or outages that may affect your circuit. Plus, you will be able to select who should be notified within your organisation and how (for example, email or SMS).
From a provisioning perspective, every dependent task can be clearly seen, providing an accurate, up-to-date and transparent overview of an order.
The final touches to Service Now are being completed, making it ready for internal release during July. This will then enable the platform to interface directly into our CRM system, allowing Account Managers to track progress of orders. Vocus’ Wholesale customers will benefit from Service Now once it integrates with the new customer web portal.
If you’d like more information about Service Now, please contact your Wholesale Account Manager.
* Initially available in Australia only
When Vocus’ founder James Spenceley started the business in 2008, his goal was to create a different kind of telco – one where customer service was so good, that customers absolutely loved us!
He spotted an opportunity for a new breed of telco that was easy to deal with, quick to respond, and technically smart.
Six years on, the company has grown exponentially, but our goals are largely the same. As such, we recently formalised these goals with a company-wide launch, and celebration of just how far we’ve come.
Here, we share these goals with you.
Next time you want to check our pricing and service availability, head to our newly-released customer web portal.
The Portal directly interfaces with our Geographic Information System (GIS), the live source of all our infrastructure records. This means you can access accurate and real-time data about where our network extends to, where Vocus dark fibre is laid and much more.
For example, if you wish to check pricing / service availability between a Vocus Point of Presence in Hong Kong, the US or Singapore with one in New Zealand or Australia (or better still a customer site in Australia), you can now view all the components of the connection using accurate and up-to-the minute information. Simply log in and enter the two addresses to find out what’s on net, near net, and off net. Soon, this will also include pricing for third party provider local loops where Vocus does not have its own coverage.
As well as providing an accurate footprint of our network, the Portal enables customers to obtain an immediate quote*; request an order form or a call to discuss the quote; access information about provisioning; and review order status and billing.
Designed by Vocus’ very own team of developers, with input from many of our wholesale customers, this user-friendly and mobile-friendly Portal is continuously being updated with our latest GIS data.
To receive your login and password, please contact your Wholesale Account Manager.
* Pricing initially available to Australian Wholesale Customers only.
Vocus Communications Limited (ASX: VOC) is pleased to announce it has entered into agreements with Telecom New Zealand Limited (TNZ) to acquire its 10% interest in the Sea-Me-We 3 cable between Perth and Singapore.
Vocus purchased the 10% share of the Sea-Me-We 3 cable segment for USD$2.3m. The cable, which is currently the only undersea cable connecting Perth to Asia, has a current design capacity of 140Gbps to be upgraded later this year to 300Gbps. The undersea cable is 100G capable and it is expected there will be further upgrades in coming years. The cable has a current effective life to 2025.
This investment has been underpinned by a long-term contract with a major US enterprise customer and has a strong return profile and is earnings accretive.
The acquisition increases Vocus’ investment in Western Australia, a key growth market for the company. Vocus continues to invest in its metropolitan fibre network in Perth including recently connecting the newly opened NextDC P1 data centre in Malaga.
Vocus CEO, James Spenceley said, “To own a portion of this cable represents an incredible opportunity for Vocus. This is key piece of critical infrastructure for Australia and reflects our focus on both domestic and International fibre optic infrastructure. Being a part owner on this route will be a significant differentiator for Vocus in the enterprise and international market.”