Vocus Group boss Kevin Russell says the telco is better placed to win a bigger slice of the market under private ownership, with the takeover target’s board backing the $3.5 billion bid lobbed by Maquarie’s infrastructure fund and Aware Super.
Macquarie Infrastructure and Real Assets (MIRA) lobbed its indicative bid for Vocus in February and was subsequently joined by the superannuation fund to pore over the telco’s books.
Vocus Group managing director and chief executive Kevin Russell.Credit:Rhett Wyman
The scheme implementation deed agreed to between Vocus and the suitors will see an entity owned by the MIRA/Aware Super consortium buy all Vocus shares at $5.50 a share. The offer, at a 25.6 per cent premium to the telco’s closing price of $4.38 a share on February 5, has been warmly welcomed by its management, with Mr Russell saying it offers the telco a chance to maximise the potential of its fibre networks.
“Vocus being taken into a private status instead of a public status is interesting,” he said.
“It gives us a bit more flexibility to invest strategically, without the scrutiny of short-term targets, which I think is advantageous at a time when we are entering a critical investment space. It’s critical for us to look for strategic infrastructure investment opportunities, a private company is more conducive to making these investments.
“MIRA and Aware are smart long-term investors, they will bring balance sheet strength, access to capital. They are strong shareholder names that enhance the credentials of Vocus and give credibility to our ability to fund future expansion opportunities.”
Vocus shares closed Tuesday’s session 8.6 per cent higher at $5.43, the highest they have been since mid-2016.
Vocus operates over 30,000 kilometres of fibre across major Australian cities and the fibre business, which delivered $128.7 million in earnings in the most recent half year, is seen as the key asset being sought by its suitors.
However, the deal, which is subject to an independent expert’s report, does bring a level of uncertainty for Vocus, especially around its plans to list its New Zealand operations.
