TPG gets funding to buy Pipe Networks

Company announces it has secured a financier for its purchase of Pipe Networks

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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