ASX-listed Vocus Communications (ASX:VOC) has been given the green light to acquire Perth-based telco Amcom Telecommunications (ASX:AMM) .
Vocus has offered $2.45 per Amcom share in an all scrip transaction, valuing the acquisition at about $635 million.
The combined entities will have a market cap of about $1.1 billion, creating a national corporate, government and wholesale telecommunications infrastructure provider.
The merger could create the third largest telco behind Telstra and Optus.
Vocus and Amcom entered into a trading halt on the ASX on December 17, but merger talks started taking place after Vocus acquired a 10 per cent interest in Amcom in October.
“This proposal represents an attractive value outcome for shareholders and a unique opportunity to participate in the continued growth of the companies,” Amcom chairman, Tony Grist, said. “The combined businesses are incredibly complementary and the combination will add scale, significant synergy benefits and real value for both companies shareholders.”
Under the combined entity, Vocus CEO, James Spenceley will become the group CEO, Vocus CFO Rick Correll will become group CFO and Vocus chairman David Spence will be group chairman.
Amcom CEO, Clive Stein, will continue with the business for a period following the completion of the transaction.
There will be about 70 sales staff across Australia and New Zealand focused on corporate and wholesale telecommunications solutions, and a combined customer base of about 3750. Headquarters for the combined group will be based in Sydney.
The acquisition is expected to be completed in April.