TPG shareholders have backed the proposed $15 billion merger between the publicly listed telco and fellow carrier Vodafone Hutchison Australia (VHA), with the latter to be pulled into the TPG fold by the end of the month.
The move sets in motion the final steps of the creation of a new Australian telco powerhouse, with the combined company set to become a house of brands featuring Vodafone, TPG, iiNet, Lebara, AAPT and Internode.
TPG shareholders also voted, during an extraordinary general meeting (EGM) on 24 June, in favour of a special resolution to change the company name from TPG Telecom Limited to TPG Corporation Limited.
“TPG shareholders have voted overwhelmingly in favour of the proposed merger with VHA,” TPG chairman David Teoh said.
“This is an important milestone to have reached as we work to bring together our two highly complementary businesses to create a leading integrated, full-service telecommunications company with a comprehensive portfolio of fixed and mobile products in the Australian telecommunications market.”
According to VHA CEO Iñaki Berroeta, the scheme of arrangement vote is one of the final steps towards implementation of the merger, which has been in the works for nearly two years.
“Today is a significant milestone in the merger process and subject to final court approval, we will be bringing VHA and TPG together in two and a half weeks,” Berroeta said.
“The merger will create a leading full-service telecommunications provider which will be well-positioned to drive stronger competition in the market and deliver benefits to customers and shareholders,” he added.
Now that the merger has formal shareholder backing, the company will seek court orders for approval of the scheme at a hearing scheduled for Friday, 26 June. If the scheme is approved by the court, it will become effective on Monday 29 June 2020.
Once that happens, TPG shares, under the current ASX code ‘TPM’, will be suspended from trading on the ASX from the close of trading on Monday 29 June. Vodafone Hutchison Australia will then change its name to TPG Telecom Limited on Monday 29 June.
The new TPG Telecom Limited will then be admitted to the ASX under the code ‘TPG’ on Tuesday 30 June, with trading to commence on a deferred settlement basis. According to TPG, the scheme itself will be implemented on Monday 13 July.
The fruition of TPG and VHA’s plans to combine their resources into a single entity has been long in the works. It was in late August 2018 when TPG Telecom confirmed that it was in discussions with Vodafone Hutchison Australia regarding a potential "merger of equals".
In May 2019, the Australian Competition and Consumer Commission (ACCC) decided to oppose the proposed $15 billion merger between the two companies.
Not long after that decision, TPG and VHA moved to file legal action in the Federal Court following the ACCC decision to oppose the merger.
By February this year, the Federal Court had voted in favour of the merger between the companies, overruling opposition from the competition watchdog.