M2 Telecommunications continues its acquisition drive, snapping up Time Telecom via subsidiary Southern Cross Telco for $AU18.5 million.
The Time Group has around 30,000 small and medium sized business and residential customers Australia-wide.
The complex transaction involves paying the cash consideration over three tranches, the first payable upon completion, with the remaining tranches payable six and nine months after completion, subject to the achievement of certain minimum performance milestones.
M2 has an established relationship with Time as a wholesale customer. M2's CEO, Geoff Horth said, "the transaction has appeal to M2 for a number of reasons, most notably that the assets will contribute to earnings for the 2013 financial year and were acquired for less than three times annual EBITDA, consistent with the purchase price of other assets of this nature.”
Last year M2 acquired the assets of business focussed provider Clear Telecoms and Austar United Mobility.
The Clear assets acquired by M2 for $AU24.5 million included all customer contracts, operating systems, brands and all other related intellectual property in addition to 20,000 SME customers.
The Austar acquisition included customers records of 15,000 Austar customers in a $AU2 million deal. ®