Telecommunications provider Amaysim has announced completing its acquisition of Australian Broadband Services (AusBBS), with Amaysim paying AU$1 million in cash and AU$1.5 million in shares upfront.
"Amaysim has today paid, in cash and shares, the first tranche of consideration for the acquisition," Amaysim said in a statement to the Australian Securities Exchange (ASX).
"This includes: Issuing to the selling parties 839,569 ordinary shares in Amaysim, of which 380,743 shares are subject to escrow for six months from completion, [with] the number of shares calculated using an issue price of AU$1.77 per share; and paying AU$1 million in cash to the selling parties."
The acquisition will also see Amaysim pay another AU$1.5 million in shares one year after completion, subject to the successful integration of AusBBS' proprietary platform into Amaysim's business.
Last month, Amaysim announced its acquisition of AusBBS in an effort to enter the National Broadband Network (NBN) retail market.
"We believe the timing is perfect; there is a forced one-off migration event that's going to happen in Australia over the next three years ... when we launch, we will launch ADSL and NBN, but naturally, we will want to capture the benefits of the migration to NBN and the switching opportunity that's going to exist," Amaysim CEO Julian Ogrin told ZDNet last week.
"How we're going to do it -- we always said we want to bring the Amaysim philosophy into fixed broadband. We're a technology leader, our success is built on our technology platform. We provide an online disruptor experience not unlike Netflix, not unlike Spotify or Uber, and for us it's download the app, we're the telco in your pocket, and we want to drive that experience into fixed broadband as well."
The chief executive told ZDNet that Amaysim plans to differentiate its NBN offering by providing customers with assistance during their broadband switchover, including in completing tasks like finding electricians.
"It's not just about being online, but it's just about addressing the pain point of the needs of the customer," Ogrin explained.
Amaysim also wants to combine its digital customer experience with AusBBS' cloud-based platform.
"We want to be digitally led, and one of the things I would say is what AusBBS brings is they bring the underlying technology enabling platform which does all the web flow management in an automated fashion, which talks to all the different people that need to be communicated to in a scalable fashion," Ogrin said.
"What we bring is our customer experience layer, the UX that sits over the top ... we have an in-house web development team, we will obviously have our team that will work on a user experience that can sit over the top of that platform."
Ogrin said the two companies will now begin working on their market strategy, encompassing product, brand, experience, and integration of AusBBS' network into the Amaysim business.
Amaysim published its full-year results for 2015-16 last Friday, revealing a net profit after tax of AU$12.31 million, down 48.7 percent from the AU$24 million reported a year ago due to the expenses incurred in its acquisitions of AusBBS and Vaya.
Amaysim's earnings before interest, tax, depreciation, and amortisation (EBITDA) grew substantially, however, up 79.3 percent from AU$14 million to AU$25.1 million, as did its revenue, which increased by 19.3 percent, from AU$212.6 million to AU$253.5 million.
Amaysim also acquired mobile virtual network operator (MVNO) Vaya for AU$70 million in January via AU$5 million in cash, AU$15 million in Amaysim scrip, and assumption of Vaya's AU$50 million liability to Optus.
The Optus debt will be paid through Amaysim's cash flow over a 24-month period ending January 2018, and as such should not impact Amaysim's net profit next financial year.
Ogrin called Vaya the "icing on the cake" for Amaysim's offerings, allowing it to adopt a "dual-brand strategy".