On the brink of finalising their merger, modem maker Sirius and memory specialist Hypertec, have abandoned the deal due to incompatible commercial considerations.
"We couldn't come to an agreement on some commercial matters," claims Sirius' chief financial officer David Marshall, a position reiterated in a report to the Australian Stock Exchange yesterday morning.
Neither Marshall nor Hypertec managing director Colin Lillywhite, is overtly concerned with the arrest of the deal.
"The reason we were in merger talks with Sirius was to create a bigger company with a bigger economy of scale," explains Lillywhite. "Even though Sirius was a good fit we will continue to look for other partners, though we won't have to go out knocking on peoples doors," he continues.
Marshall claims that Sirius is no longer in a position where it needs to depend on the merger for its survival. "We are in a much stronger position than we were at the beginning of the year and the board had more confidence to refuse the offer when certain issues weren't resolved," explains Marshall.
Consequently Sirius is not "actively searching" for another alliance. Marshall will not preclude the option that eventually Sirius might enter into merger talks with another party but at present the goal is to "get the best possible deal for our stock holders and we can give that by going forward by ourselves."
Both Marshall and Lillywhite assure clients that the abandonment of the deal will not adversely affect the distributor relationship Sirius has with Hypertec. "There was no animosity in the termination of the deal. We have a very strong relationship with Hypertec, that's why the merger talks started in the first place. Hypertec will remain Sirius' distributor," asserts Marshall.