- TPG Telecom confirms merger talks with Vodafone Hutchison.
- The deal would be a “merger of equals”.
- Nothing has been decided yet.
TPG Telecom is in talks with Vodafone Hutchison about a merger.
The telco today confirmed it was in “exploratory discussions” with Vodafone Hutchison Australia on a potential “merger of equals”.
At the close, TPG shares were up 21.6% to $7.65.
“The TPG Board notes that there is no certainty that any transaction will eventuate or what the terms of a transaction would be,” the TPG statement said.
TPG issued the statement following speculation that the company was looking at a takeover of the local Vodafone business.
Vodafone in Australia is jointly owned by its UK parent and a subsidiary of CK Hutchison Holdings, headquartered in Hong Kong.
TPG Telecom shares have been on a run, last trading at $6.29, up from $5.63 last week.
The company, which is building its own mobile network in Australia and Singapore, has been hit by headwinds from customers migrating to the NBN, Australia’s compulsory new broadband network.
Vodafone operates in the mobile market and would give TPG Telecom a ready-made customer base for Australia’s fourth mobile network when completed by TPG.
In its latest results, profit was down 11% to $199.9 million for the six months to January. However, underlying profit was up 4.9% to $217.7 million.
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