Line goes quiet on Vocus’ offer for 2degrees
mocking the EU’s alleged attempt to regulate the shape of bananas, and it’s hardly surprising in retrospect that Brexit got over the line.
The result, however, is deep uncertainty. In the short term, that means financial market volatility; in the medium term it means decisions of every kind – from buying a house in Britain to investing in new jobs – being delayed.
Deep uncertainty is, for the most part, paralysing, and the talent of current European political leadership will be sorely tested. Yet, from this distance, you have to ask: How much does it really matter?
What’s the bet that in a couple of months’ time, the only people who care – really care – about Brexit anymore are the Poms?
Sure, it will be interesting for the rest of us and there will be ongoing fascination with who will be the United Kingdom’s next prime minister, when will their next general election be, and whether the Brexit vote will have any impact on the United States presidential election.
US polling has shown a sharp swing away from Donald Trump in the last few days, suggesting the message to American voters from Brexit is ‘‘Be careful what you wish for’’ rather than ‘‘Viva la Revolucion’’.
In Australia, the Liberal coalition of Prime Minister Malcolm Turnbull is looking a little safer ahead of Saturday’s federal election.
Conventional wisdom suggests there’s a devil-you-know element at play. For those of us on the sideline, the biggest question may be: How long will that last? A possible takeover of 2degrees by New Zealand’s third-largest fixedline phone and broadband provider, Vocus Communications, appears to be off the table for now.
Vocus’ management is understood to have discussed making an offer for 2degrees over the past few months.
But the Australian-based company has instead announced the A$807 million (NZ$847m) acquisition of Australian fibre-optic network company Nextgen Networks and two other Australian firms.
Vocus, which is valued on the Australian stock exchange at $4.5b, will fund the purchases through a capital raising and has suspended trading in its shares until Monday.
Vocus became a major player in the New Zealand telecommunications market following its acquisition of M2, which had bought CallPlus’ business for $250m in April 2015.
Last year it accounted for about 15 per cent of the New Zealand broadband market, with 220,000 customers, according to an annual report published by the Commerce Commission.
A source said the company’s top brass had differing views on the merits of making a bid for 2degrees, which is majority-owned by United States investment firm Trilogy International Partners.
Vocus’ New Zealand managers, who joined the firm as a result of the M2 merger, were keen on recommending an offer to Vocus’ board, with Vocus ‘‘old timers’’ opposed, the source said. Vocus has been contacted for comment.
2degrees spokesman Mat Bolland said it would continue to grow its business and was always exploring opportunities to raise capital to grow faster.