Yesterday saw a significant merger announcement in the Australia fiber market. TPG Telecom has announced the purchase of AAPT from Telecom New Zealand for AU$450M. The deal will give them a national fiber backbone to supplement and expand their existing ISP business.
AAPT has been on the block, whether officially or not, for several years. Back in 2008 rumors had Pacnet kicking the tires or at least thinking about it, and in 2010 AAPT sold its consumer business to iiNet. Telecom New Zealand bought the business for about 5x today's price back in 1999, but of course nobody in the fiber business has ever managed to live up to their market value in 1999.
In more recent times, AAPT posted AU$205M in revenue and AU$30M in adjusted EBITDA in the first six months of this year. Intense price competition has driven down both metrics in recent years. Hence some sort of consolidation was probably inevitable.
TPG already owns metro fiber in Sydney, Melbourne, and Brisbane as well as the PIPE cable system for submarine connectivity up to Guam. AAPT's 11,000km of intercity fiber hooks up some 1450 on-net buildings nationwide, which will help TPG gain greater control over its own infrastructure and further increase the amount of fiber in its diet. They also get the CDN infrastructure AAPT put together with the help of Edgecast Networks. Edgecast of course just made the news yesteray with a proposed sale to Verizon.
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