With Pacnet this week ruling itself out of the immediate running to buy struggling communication Company AAPT the battle to acquire the NZ Telecom subsidiary, is being fought out between rival ISPs iiNet and TPG – with iiNet appearing to be favourite in the two-horse race.
In key developments yesterday, iiNet called an ASX halt on trading in its shares until Monday, “pending the announcement of a potential acquisition”; while NZ Telecom revealed it had sold AAPT’s stake in Macquarie Telecom for just under $10 million, clearing the way for a separate sale of AAPT’s broadband business.
Telecom’s announcement came after The Australian newspaper reported that iiNet had submitted a proposal that would see AAPT’s retail and wholesale arms sold as separate entities.
Telecom NZ originally hoped to sell the whole telco in a $300 million-plus deal, The Oz said, but had now decided to split the business, “with a view of holding its wholesale fibre division for a possible sell-off into the National Broadband Network at a later date.”
A prize part of the wholesale division is its fibre backhaul network, which covers more than 3000km.
Should iiNet get control of AAPT a battle with Telstra is tipped by analysts.
At stake in the retail sector are about 120,000 AAPT broadband and 230,000 voice customers. They would be prized by both iiNet and TPG.
IiNet has around 530,000 current broadband subscribers. TPG earlier this year said it 460,000 broadband subscribers at March 31, after adding 54,000 during the first quarter.
A win by TPG would see it surpass iiNet to become the nations third biggest force in the broadband market. A win by iiNet would cement its position.
– FOOTNOTE: Should TPG and iiNet bids both fall through, there could still be a third suitor in the wings. While Pacnet CEO Bill Barney made it plain this week that the Hong Kong company is not currently interested, he did not rule out looking at AAPT’s business again in the future. “We didn’t say no to an AAPT acquisition in the future,” Barney said in the closing stages of this week’s media lunch. “We said no AAPT in the near future. Who knows what the [long-term] future holds?”
