Telstra has revealed the addition of almost one million new mobile services in the six months to December 2011, but Sensis revenues plummeted 24 percent in 12 months.
Telstra has made its first overseas acquisition under Sol Trujillo, taking a 51 percent stake in leading, and rapidly growing, Chinese real estate website SouFun.
Telstra will pay $US254 million to acquire the stake. SouFun founder an CEO, Vincent Mo will remain a significant shareholder and continue in the role. The balance of the shares will be held by management and IDG, a venture capital firm.
Telstra has moved to minimise the cash outlay for the deal, and allay investor concerns, by simultaneously announcing the sale of a 'non-core' asset: Australian Administration Services (AAS), the superannuation administration business of its subsidiary KAZ Group. This has been sold to Link Market Services for $A215 million. Telstra will take $35.5 million from the proceeds of the AAS sale leaving it with a net outlay of $A91.5 million for SouFun. The transaction also includes 100 per cent of Atune Financial Solutions Pty Ltd and the remaining 50 per cent equity in Money Solutions Pty Ltd.
Telstra stressed that "KAZ continues to be a crucial part of Telstra's ICT strategy and service delivery...KAZ will continue to offer business process outsourcing services which are IT and communications intensive – such as document management and contact centre services – and aligned to the core capabilities of KAZ and Telstra." It will also continue to provide IT services to AAS.
Telstra stressed the growth prospects for SouFun and the synergies with its existing Sensis online businesses. "SouFun is cash flow positive from day one and is expected to contribute net revenue and EBITDA of $A$52m, and$A18m respectively in FY2007." Sensis CEO, Bruce Akhurst, said.
Telstra claims that the online real estate market in China is growing at 66 percent CAGR, real estate sales by value at 21 percent and online adverting general at 44 percent.
SouFun is currently among the top 100 most visited websites worldwide, and promotes new properties in 40 cities. Sensis intends to expand this to 100 by December 2008 and to "leverage SouFun's highly desirable user base to provide offerings into adjacent businesses e.g. home related offerings."
Telstra also views SouFun as a stepping stone into the wider China market, saying: "The investment will yield relationships and experience in China from which further opportunities will emerge."
David Bass
| ComOps, a leading Australian provider of business software products and services, has won a competitive tender to deploy its Salvus safety, r…
How to Make Business Discovery Work for Your Business
Business Discovery takes its cues from consumer apps. Like Google, it encourages us- ers to hunt for and explore data without worrying about or even noticing the underly- ing technology. Their entire experience is working within an intuitive interface to get real-time, self-service results with only minimal training. ...more
Try an easy-to-use set of web-enabled
tools for business-class productivity services. Office 365 provides
anywhere-access to email, important documents, contacts, and calendars
on almost any device.
Latest Headlines from IT INDUSTRY
