iiNet is on the verge of purchasing neighboring W.A. based Internet Service Provider ‘Westnet’ for $81 million. Australia’s 3rd largest telecommunications company is expected to finalise the deal at the end of this month when it will secure an additional 215,000 active subscribers bringing their total number of active services to in excess of 680,000.
The acquisition is believed to add an extra $135 million per year to iiNet’s annual revenue earnings bringing its total revenue to approximately $375 million p.a.. According to iiNet managing director ‘Michael Malone’, Westnet will become a subsidiary of iiNet and will operate as per usual with the only foreseeable change being Westnet’s current wholesale network supplier.
“Westnet is a well run and growing business that has regularly been spinning off profits. The last thing we want to do is mess it up,”
In a presentation to iiNet shareholders, the ISP said there would be opportunity for both brands to cross-sell each other’s products, allowing Westnet to sell iiNet’s naked DSL products and iiNet to sell Westnet’s satellite services to regional customers.
“Westnet has quite a different market to iiNet. We both compete in Perth, but outside that, iiNet is primarily a metro player and Westnet is primarily a regional player. Westnet also has an incredible dealer network that is loyal to Westnet. I’m very reluctant to consider changing that. And of course there is a very competent management and staff team over at Westnet too,”