Vodafone New Zealand is reportedly looking to hire UBS to defend it against a takeover by Australian ISP TPG Telecom, if it has not done so already. Such an acquisition is looking increasingly likely and the target could fetch some NZ$1bn, according to a local report.
Vodafone New Zealand is reportedly looking to hire UBS to defend it against a takeover by Australian ISP TPG Telecom (ASX:TPM), if it has not done so already.
UBS’ Peter Nelson, a former Vodafone employee, is widely tipped to win the mandate, The Australian reported, noting that he may have already secured it.
A TPG takeover of Vodafone NZ, the country’s largest mobile operator and second-largest ISP, is looking increasingly likely, the report stated, adding that the business is expected to be worth about NZ$1bn (US$676.4m).
Such an acquisition would enable TPG to trial an expansion into the mobile market which, if successful, it could replicate at home.
Last September, TPG, advised by Macquarie Capital, acquired local rival iiNet for A$1.56bn (US$1.1bn), creating Australia’s second largest fixed-line player behind incumbent telco Telstra and pushing Optus into third place.
That same month, Vodafone Hutchison Australia and TPG announced a tie-up which would see the latter provide dark fibre and network services to some 3,000 of the former’s sites for 15 years. The agreement was considered by some to be precursor to an attempted takeover by TPG of Vodafone’s Australian unit or Hong Kong-based CK Hutchison’s stake in it.
According to the report, a TPG acquisition of Vodafone’s Australian unit could cost up to A$4bn (US$2.98bn), just under half of the ISP’s own market value. It would, however, create a strong competitor to Telstra and Optus in the fixed and mobile spheres.
Back in New Zealand, the smallest of the three mobile network operators, 2degrees Mobile, could also be the target of an Australian company, specifically recently-merged ISPs Vocus and M2, the report stated. Vocus was advised by Credit Suisse on the merger, and M2 byGoldman Sachs.
Vodafone NZ, TPG and UBS were not immediately available for comment.
