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Singtel's Optus to buy Australia MVNO Amaysim's mobile business for A$250m
SINGAPORE Telecommunications' (Singtel) wholly-owned Australian subsidiary Optus Mobile is planning to fork out some A$250 million (S$239.7 million) to acquire the mobile service business of Amaysim Australia, before the latter winds up.
Separately, Optus is bringing Gomo - Singtel’s digital brand already available in Singapore - to Australia, “for those seeking simple plans and budget-friendly telecommunication services”.
Australia-listed Amaysim is the country's largest mobile virtual network operator (MVNO) and the fourth-largest mobile service provider overall. It operates on the Optus 4G Plus network, and specialises in SIM-only mobile plans.
In a press statement on Monday, Optus said it will acquire the shares of Amaysim's mobile holding company and its customer base of about 1.2 million subscribers as at Oct 20, under a purchase agreement signed between the two parties.
The A$250 million purchase price, payable in cash, is subject to completion conditions, including approval from Amaysim's shareholders and payment adjustments.
The valuation was arrived at based on Optus' assessment of the customers, assets and prospects of Amaysim's mobile business, among other things.
The proposed deal's conditions precedent also include certain agreed steps to restructure the mobile business, said Singtel in a bourse filing on Monday.
Net liabilities of the mobile business amounted to about A$300,000, prior to the restructuring, based on the unaudited financial statements as at Sept 30.
Optus said it "values the strong performance and customer-first focus" of the business and thus will keep Amaysim as a standalone brand after the acquisition.
Amaysim chief executive officer (CEO) and founder, Peter O'Connell, said Optus has been a long-term strategic wholesale partner of his firm and "is well placed to look after our customers and take the growth of the business to the next level".
Amaysim used to sell energy services as well, until it simplified its product offering on Oct 2 to focus on just mobile plans. It announced in August that it was divesting the energy business to AGL Energy in an all-cash A$115 million deal.
The proposed sale of the mobile business is expected to complete in January 2021, said Amaysim in an exchange filing. The company then plans to delist from the Australian Securities Exchange and wind up in June 2021.
It added that it had received unsolicited expressions of interest in relation to the mobile business after selling Click Energy to AGL.
Amaysim shares climbed following the news, to trade at A$0.75 as at 12.03pm on Monday in Australia, up A$0.08 or 11.9 per cent.
Meanwhile, Singtel is expanding its digital-only telco solution Gomo to the MVNO market in Australia.
Offering straightforward subscription pricing, the service runs on Optus’ nationwide network. Gomo customers will be able to control their accounts via an app for onboarding, service and payments.
More details will be announced soon, said Optus in its statement.
Gomo's contract-free SIM-only plan is already offered in Singapore, backed by Singtel’s 4G network.
Optus CEO Kelly Bayer Rosmarin described the Amaysim purchase and the Gomo launch as strategic plays to disrupt the MVNO market and offer greater choice for value-seeking customers.
With both announcements, Optus is adding two complementary brands to cater to the needs of specific groups of customers in Australia.
Ms Bayer Rosmarin noted that Optus has not had any sub brands competing in the growing MVNO segment.
Singtel shares gained S$0.01 or 0.5 per cent to trade at S$2.04 as at 9.29am on Monday in Singapore.