TPG gets funding to buy Pipe Networks
- 21 December, 2009 12:10
- Comments 8
TPG Telecom (ASX:TPM) has secured the money it needs to go ahead with its merger with Pipe Networks (ASX: PWK).
In a statement to the ASX, TPG - which changed its ASX listing from SP Telemedia's (SOT) in early December - said it confirmed it had entered into a "financing agreement with a financier which satisfies the Funding Requirement, as defined in and, for the purposes of clause 3.4(a) of the merger implementation agreement" signed between it and Pipe Networks.
In November, it was announced SP Telemedia would buy Pipe Networks for $6.30 per share and valued the latter's assets at approximately $373 million; a premium of 15 per cent on the company's volume weighted average price over the past three months prior to the announcement.
The news of the tie up created a wave of comment in the industry with many raising questions over how the operation will be run as SP Telemedia – which after a merger with TPG Holdings in 2008 has the retail brands of Soul and TPG – will gain access to wholesale assets.
More details on the tie up will be sent to Pipe Networks shareholders as part of the Scheme Booklet over the coming weeks. No further information was available on the merger at time of publication.
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Comments
jimbo
Well done on Soul/TPG for DESTROYING A GREAT COMPANY!
Glenn
@ jimbo: Just a tad pessimistic there? Pipe gets merged with TPG and suddenly it gets destroyed? Frickin genius.
Matt
@ Glenn: And an ISP owning a backhaul network isn't going to be a bad thing for the rest of the ISP industry at all. It might be good for consumers as TPG/Soul could in time offer unlimited plans but how is that going to be fair for other ISPs?
It's no different to Telstra Wholesale and BigPond. I'm far from being a fan of Telstra but if they are going to have to structurally separate then how can this be any better?
Simon
I do not agree with this either, surely this has to be approved by the ACCC first?????
I believe Pipe remaining independent of any ISP is in the best interests of all consumers.
Jim
Vertical integration is a *very bad thing* in the telecoms industry. The ACCC should be instructed to reject any merger that ties a major infrastructure wholesaler to a retail company. The temptation to commercially disadvantage competing ISPs will be irresistible.
Ithiel
*sigh*
Doesn't this frakking country ever learn?
GG. ACCC really screwed the pooch on that one. Actually, that's not being fair on the ACCC.
They were inside drinking hot coco with Telstra while the pooch was being screwed over by a bunch of money hungry bastards.
Seriously, do those guys need to be given a map and 3 point instruction guide on how to get out of ben in the morning without finding a way to further screw up the country for everyone?
They're so busy not doing anything about telstra, that it's causing them to not do anything about anything else!
You know, we are losing our right to call americans stupid...
Sam
It's not up to the ACCC to block TPG buying fibre assets, Optus and Telstra own their own, they can hardly stop a smaller ISP like TPG buying backhaul when the dominate players own theirs, how unfair would that be??? they can only work within the law and TPG are not doing anything wrong.
Mike
Vertical integration is bad for telcos.... sure... just like it is for electricity.... which direction have all your power prices gone since vertical separation.... up up up and away!
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