Clever Communications Australia has made a ‘one for one’ script offer for all of the BigAir Group’s shares with no minimum acceptance condition.
Clever Communications is a fixed wireless broadband carrier that owns and operates a network across Melbourne, Sydney, Brisbane and Adelaide.
In a statement to the ASX, David Williams, chairman at Clever, said the merger of BigAir and Clever was in the interest of the shareholders of both companies.
“The increased size, scale, market capitalisation and geographic footprint of combining two of Australia’s largest fixed wireless broadband carriers could result in potential synergy and operational benefits.”
The bid will be open for a month, which can be extended by Clever.
Independent telco analyst Paul Budde told CRN that such a deal will be of benefit to both organisations.
"In this industry, size does matter," he said.
"Combining forces to create a larger organisation would definitely position it in a better situation."
According to Budde the wireless market has always been niche and hasn't taken off since its beginnings five years ago.
"The reality is the market is very limited," claimed Budde.
"For a long time it has been running out of steam. A company like BigAir has done all the rounds and connected as many users - that want the technology - as possible."
He said as the company reaches its limit, there will be much lower customer growth and would eventually need to look for consolidation.
"I would assume [the deal] does make sense," said Budde.
However it could get unstuck because of the expectations of both companies.
"There will be back and forth about how much money, the company is really worth and its real value," said Budde.
"It could get unstuck because of high expectations and then if could turn into an ego questions."
Jason Ashton, managing director at BigAir told CRN it had no comment at this stage.
“We will be responding after we have reviewed everything,” he said.
Clever bid for BigAir
By Lilia Guan on Oct 3, 2008 1:29PM
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