Optus has bought Perth-based wireless provider vividwireless in a $230 million deal that is expected to provide a foundation for the number two telco's forthcoming Long Term Evolution mobile network.
Vividwireless, formerly known as Unwired and currently owned by Seven Group, has spent several years rolling out a WiMAX network in some capital cities and had revealed plans to roll out a national TD-LTE network in cities with potential financial backing from an Asian-based telco.
Seven Group acquired Unwired in 2008 for a reported $127 million.
Managing director Martin Mercer said discussions between Seven Group and Optus for the sale of the company occurred separately to discussions seeking financial backers.
Optus will buy the company for cash, gaining vividwireless' business, spectrum and network assets.
An Optus spokeswoman said the telco will "conduct a review of vividwireless’ operations with a view to identifying efficiencies and synergies with the Optus business".
Optus said in a statement that it would use vividwireless' TD-LTE technology in addition to its existing plans to use FD-LTE technology, beginning with a network in Newcastle from April this year.
"The acquisition of vividwireless will give Optus a significant increase in network capacity to address the next wave of data growth that is just around the corner," Optus chief executive Paul O'Sullivan said.
"By integrating it with our current 4G rollout (in the 1800 MHz band), we will be able to provide increased mobile speeds to our customers in metropolitan Australia."
Mercer pointed to similar LTE networks operated by Softbank in Japan and China Mobile as existing examples of TD-LTE's success.
"It's new and it's leading edge but it's not unprecedented," he said.
"I'm pleased Optus are going to implement the plan that we devised - that is gratifying and exciting for the people involved."
The deal is pending approval by the Australian Competition and Consumer Commission for reissuing of the spectrum, and the Foreign Investment Review Board.
"Until that happens it's business as usual," Mercer said.
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Issue: 331 | September 2014
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