TPG makes $1.4b play for iiNet

INTERNET provider TPG Telecom is set to take over rival iiNet in a deal worth $1.4 billion.

INTERNET provider TPG Telecom is set to take over rival iiNet in a deal worth $1.4 billion.

iiNet’s board of directors has recommended shareholders accept the $8.60 per share offer, which is 33 per cent above the company’s five-day average stock price.

“The board views this as a significant reward for shareholders who have shown their faith in iiNet,” iiNet chairman Michael Smith said.

TPG executive chairman and CEO David Teoh said the combined businesses would provide broadband services to more than 1.7 million subscribers and be “well positioned to deliver scale benefits in an NBN environment.

“iiNet and TPG are highly complementary businesses in terms of geographic presence, market segments and corporate customer base,” he said.

If iiNet shareholders approve the deal it should go through in July. IG market analyst Evan Lucas told The Australian the deal had been expected for years.

“It’s the worst kept secret. It was always going to happen,” he said, adding that the $1.4 billion price tag was fair. “It’s a good price. It’s not expensive but it’s certainly not cheap.”

Originally published as TPG makes $1.4b play for iiNet