Fone Zone Group has acquired Apple specialist retailer, Next Byte, in a deal worth about $30 million.
Fone Zone CEO, David McMahon, said the acquisition was a strategic fit with its plans to diversify. The purchase price includes $21 million in cash and 16.1 million in shares valued at $0.62.
"This acquisition diversifies our income stream, Next Byte is a specialist retailer expanding into the shopping centre environment, and we are trying to broaden the range of product and services within the existing Fone Zone network," he said. "Also, Apple's product range, including iPods and notebook computers, makes a compelling offer for us with our mobile solutions."
Next Byte has 17 stores around the country and all staff will be retained. Apple specialists will also be employed with Fone Zone stores.
"The intention is to leave the Next Byte business trading independently and stick with their systems, branding and strategy," McMahon said. "We will go through internal training because we need to have a thorough understanding of the Apple products in order to provide quality customer service. Apple is keen to support us with mobile computing solutions around notebooks and messaging data cards. That tends to be an untapped niche: traditionally you either sell computers or mobile devices, so we will be the first specialist doing both."
iPods are expected to hit the Fone Zone shelves before Christmas, followed by notebooks and PCs early next year. Fone Zone has about 150 stores nationally.
"Once we get our feet under the desk we will be looking at a retail model to see if we can potentially grow to a much wider audience within the shopping centre environment," McMahon said.
The acquisition is expected to be completed in September.