[AusNOG] News: Vocus completes its master plan with A$860m Nextgen Networks buy

[Skeeve Stevens]

Here we go!!!

As predicted :-)

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*Vocus completes its master plan **with A$860m Nextgen Networks buy*


Vocus has entered a binding agreement to acquire 100% of Nextgen Networks,
as well as the Australia Singapore Cable and North West Cable System
projects, from the Nextgen Group for A$807 million up front plus a deferred
consideration of up to A$54 million.


While the move confirms recent reports noted in today's CommsDay, the firm
has been actively working on the deal since late last year. And Vocus
executive director James Spenceley told CommsDay that the buy was the final
key step in an overarching acquisition strategy that dates right back to
Vocus' 2010 listing on the Australian Securities Exchange.


"We've been working on this since December, but we've... been looking at it
pre-Amcom. When we listed Vocus, the idea was really to go into dark fibre,
so we did that; then to expand geographically with Amcom and FX Networks,
then move into consumer with M2. But Nextgen was always on that priority
list; we've just got the size and scale now to be able to do that, and the
balance sheet to do it," he said. "It's completing the master plan. We've
got all the infrastructure, we've got the base to work from in all parts of
the business now."


Giving Vocus ownership of Nextgen's extensive intercapital fibre network
and its ongoing submarine cable projects, excluding only its datacentre
assets, the acquisition will further entrench Vocus as a key player amongst
Australia's 'big four' fixed-line operators alongside Telstra, Optus and
TPG.


Indeed, Spenceley said that Nextgen's 17,000km national backhaul networks
would give Vocus a critical advantage in what has become a key field of
fixed-line differentiation: access to NBN points of interconnect. A
post-Nextgen Vocus would be able to reach 112 of the 121 POIs nationally,
given A$11.5 million of additional capex, along with fibre access to 70
datacentres and 1,100 buildings. "It should give us the second or third
most POIs connected of the big four," said the executive director.


Vocus CEO Geoff Horth similarly described the move as providing the
"missing piece" in the firm's infrastructure network, allowing it to
connect its extensive metropolitan infrastructure to Nextgen's intercapital
fibre and "thereby connecting mainland capital cities to regional and
remote areas on one owned network."


Vocus will fund its latest acquisition through a fully underwritten equity
capital raising comprising a pro-rata A$452 million 1-for-8.90 accelerated,
renounceable entitlement offer with retail rights trading, plus an
institutional placement of up to around 26.5 million shares to raise an
extra A$200 million. It will fund the balance via existing committed debt
facilities.


The deal is expected to complete in around three months, subject to
clearance from the Australian Competition and Consumer Commission.
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...Skeeve

*Skeeve Stevens - Founder & The Architect* - eintellego Networks Pty Ltd
Email: skeeve at eintellegonetworks.com ; Web: eintellegonetworks.com

Cell +61 (0)414 753 383 ; Skype: skeeve ; LinkedIn: /in/skeeve
<http://linkedin.com/in/skeeve> ; Expert360: Profile
<https://expert360.com/profile/d54a9> ; Keybase: https://keybase.io/skeeve
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