Telstra has made its first major retail acquisition, entering an agreement to purchase Adelaide-based internet service provider (ISP) Adam Internet, subject to regulatory approval.
The Courier-Mail reported that the deal was rumoured to be worth more than AU$50 million and that the company had called an emergency meeting for staff late last night to discuss the deal, however Adam Internet owner Greg Hicks reportedly described this as "total bulls**t."
This morning, Telstra announced that, subject to approval from the Australian Competition and Consumer Commission, Telstra will acquire Adam Internet, including its Adelaide datacentre and fibre.
Under the deal, the Adam Internet brand will remain as a separate subsidiary of Telstra.
"Adam is a respected brand with a loyal customer base in South Australia. It's a great online, low cost business that lets customers purchase and manage their own services. This model offers opportunities for growth, particularly for consumers wanting online sales and support," Telstra's Innovation Products and Marketing Group Managing Director Kate McKenzie said in a statement.
"Customers trust the Adam brand, and we'll certainly be keeping it as we work towards further growth under Adam's first class management team."
Hicks will stay with the company, and no other staff changes are expected at this time.
"We've built a great business, with a great team running it, and we've got a bright future. Adam Internet customers can continue to contact us in the normal way," Hicks said.
The company's firmer managing director, and Greg Hicks' son, Scott Hicks left the company in August after 17 years with Adam Internet.
When iiNet bought out Adelaide rival Internode at the end of 2011, Adam Internet put out statements crowing about the company being the last independent ISP in the state.
"Adam Internet is the only true remaining South Australian ISP," the company said in a press release in July.
A press conference to discuss the deal has been announced for 11 a.m. AEDT.