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TransACT sale to iiNet confirmed for $60 million

By johnboy - 21 November 2011 22

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The stock exchange have posted iiNet’s statement on their takeover of local telco TransACT.

They’re paying $60 million in cash, with the senior management team to remain.

Core bundling with ActewAGL is prominently mentioned, so expect that to continue.

The deal is to be finalised on 30 November 2011.

UPDATE: TransACT’s media statement is now online.

“We’re delighted to join iiNet, an experienced and successful player in the telecommunications industry. We see this as very positive news for our customers and we are looking forward to exploring the benefits that will most certainly flow as our two businesses join together,” Ivan Slavich, TransACT Chief Executive Officer said.

Michael Malone, iiNet’s Chief Executive Officer said the acquisition of TransACT represented an opportunity to quickly build presence in key growth markets.

“This acquisition will deliver significant network assets, while increasing iiNet’s presence in the ACT and regional Victoria. This move will also accelerate our penetration into the small business, corporate and government sectors, a key strategic focus for us,” Mr Malone said.

Mr Slavich went on to say that the agreement was a good fit for both companies.

“We have much in common with iiNet. We both started small, challenged the bigger guys and built quality networks to even out the playing field. Our mutual success is built on the back of quality products and services and a commitment to customer service excellence, which is the envy of our competitors,” Mr Slavich said.

“TransACT began as an off-shoot business of Actew more than ten years ago and has made its mark as an innovative and visionary business. TransACT led the industry, rolling out Fibre-To-The-Premise broadband and we’ve continued to grow in the residential, business and corporate, and government markets.

“Our unique services set us apart from competitors, from our utility Bundle offering to our Pay TV service, data centres and managed services,” Mr Slavich concluded.

The ownership of the business has changed, but the services TransACT provides to customers, their current agreements, and the quality of customer care from TransACT’s experienced staff will continue.

What’s Your opinion?


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22 Responses to
TransACT sale to iiNet confirmed for $60 million
watto23 3:15 pm 21 Nov 11

Well the transact cable is soon to be worthless when NBN fibre goes in. Which I can’t wait for given transact promised me several times, they’d run cable to my suburb, only to find out it was never happening. anbd then no ADSL2 until recently when telstra put some DSLAMs in… and no i live in Tuggers not Gungahlin!

Deref 2:11 pm 21 Nov 11

Gotta be a good thing. TransACT’s been moribund for years. Their TV feed is about the same resolution as Youtube, for example. A bloke who came to replace our cable modem a few months ago said it was to do with the capacity of the disk drive at the nodes – that they were slowly replacing them and that’d fix the problem, but it’d take a long time. I doubt that anyone ever used the video on demand service because of the appalling quality.

johnboy 1:37 pm 21 Nov 11

ramblingted said :

“They’re paying $60 million in cash…”

Unlikely, unless they have are thinking about loading a truck like the one in the Tattslotto advert…

Cash meaning it’s not an equity swap.

ramblingted 1:30 pm 21 Nov 11

“They’re paying $60 million in cash…”

Unlikely, unless they have are thinking about loading a truck like the one in the Tattslotto advert…

KaptnKaos 1:29 pm 21 Nov 11

Hope the iiNet introduce something called “Customer Service”.

Now if there was only some competition for gas, electricity and water then we could be rid of the other half of this no-service monopoly.

dungfungus 1:20 pm 21 Nov 11

“Plus, they just lost a source of income……”

Are you serious? TransACT has never made any money; it was one of those situations where it would have been cheaper to “close the doors” at least 5 years ago. I hope that the $25 million standy facility that ActewAGL provided comes “off the top” of the $60 million sale proceeds before it is distributed to the shareholders. ACT ratepayers are shareholders through the ownership of Actew by the ACT Government incidentally. I can see the new electric car venture ending up the same as TransACT. These people have no idea how to run a business probably because none of them have ever risked and lost a dollar of their own.

DUG 12:50 pm 21 Nov 11

Grail said :

Chop71 said :

Maybe now ACTEW could just concentrate on providing water, sewerage and power at affordable rates.

What makes you think they’re not planning to put those prices up as high as they possibly can? They are a monopoly, and a corporate entity to boot.

Plus, they just lost a source of income.
Hey! maybe now I can finaly get more than a 2.5Mbps connection in Tuggeranong from IInet… Just joking i’m not a complete idiot, maybe in 10years when/ if the NBN gets finished. – and before anyone says anything; i am over 4km from the exchange.

Grail 12:10 pm 21 Nov 11

Chop71 said :

Maybe now ACTEW could just concentrate on providing water, sewerage and power at affordable rates.

What makes you think they’re not planning to put those prices up as high as they possibly can? They are a monopoly, and a corporate entity to boot.

Grail 12:09 pm 21 Nov 11

G-Fresh said :

Let’s hope they purchase enough bandwidth capacity to service their customers rather than having it ping off the limiter 16 hours a day.

iiNet has access to much more favourable pricing on backhaul, so for the same money TransACT should be able to get almost an order of magnitude more backhaul capacity. The “economy of scale” myth applies everywhere, not the least to internet backhaul pricing 🙂

Morgan said :

Hopefully they can revitalise a very tired Transact Model. Transact with their infrastructure has loads of potential, but with hard to understand and overly complicated pricing and products – combined with 1990’s expensive bills, were never going to go anywhere.

I, too, find the pricing model of TransACT residential services to be bizarre and Byzantine. I’d be much happier recommending their services to friends if each product was competitive, rather than having to bundle unwanted services such as TV and PayTV in order to get a comparable price on Internet access!

Chop71 11:54 am 21 Nov 11

Maybe now ACTEW could just concentrate on providing water, sewerage and power at affordable rates.

G-Fresh 11:50 am 21 Nov 11

Let’s hope they purchase enough bandwidth capacity to service their customers rather than having it ping off the limiter 16 hours a day.

Holden Caulfield 11:33 am 21 Nov 11

Let’s hope iiNet manages this much better than the webone debacle, which really was a case of we-boned you!

roccon 11:19 am 21 Nov 11

here’s hoping they put the cleaners through Transact and restart the business to be more aggressive in implementing new technology and trying to stay ahead of the pack instead of an also ran….

Morgan 11:13 am 21 Nov 11

iinet is a good company, have been a customer for years and their products are well priced, they are reliable and tech support is great.

Hopefully they can revitalise a very tired Transact Model. Transact with their infrastructure has loads of potential, but with hard to understand and overly complicated pricing and products – combined with 1990’s expensive bills, were never going to go anywhere.

dungfungus 11:08 am 21 Nov 11

According to Mr Slavich, spending over $400 million on building a business then selling it for $60 million is “success”?
Give me a break.

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