The merged company will become the 4th largest integrated telco in Australia and the 3rd largest in New Zealand.
The merger will take place by way of an M2 scheme of arrangement with M2 shareholders receiving 1.625 Vocus shares for each M2 share.
M2’s Board of Directors have unanimously recommend that the company’s shareholders vote in favour of the deal, and in the absence of any superior proposal, and subject to expert opinion, that the scheme is in the best interests of M2 shareholders.
James Spenceley, CEO and founder of Vocus, will continue on the combined board of the newly merge company as Executive Director with a focus on telco infrastructure strategy.
Geoff Horth, CEO of M2, will be appointed as the CEO of the merged group.
In other changes, Vaughan Bowen, Executive Director and founder of M2, will also continue on the combined Board as Executive Director, retaining a focus on strategic acquisition opportunities.
The board of the merged entity Board will be comprised of eight directors, with four each from Vocus and M2.
David Spence, Chairman of Vocus, will be Chairman of the combined group, with M2 Chairman Craig Farrow appointed as Deputy Chairman. Tony Grist, formerly of Amcom Telecommunications, will continue as a Non-Executive Director.
A statement issued this morning on the strategic rationale for the merger says it will create a “full service vertically integrated infrastructure-backed trans-Tasman teleco” - with scale and proven capabilities relevant to every individual, corporate and government entity in Australia and New Zealand.
The companies say the newly merged business will also be strategically positioned to take full advantage of the NBN in Australia and UFB in New Zealand.
David Spence, Chairman of Vocus, said the merger of Vocus and M2 is a “compelling opportunity for all shareholders.”
“The businesses combine Vocus’ telecommunications infrastructure and corporate customer base with M2’s demonstrated expertise in the consumer and SME segments. The merger creates the 4th largest vertically integrated telecommunications company in Australia and the 3rd largest in New Zealand.”
And, Craig Farrow, Chairman of M2, said, “M2 and Vocus are an excellent fit, being highly complementary and culturally aligned. Both have successful track records of creating substantial value for shareholders and, together, we will retain this focus. Our ability as a merged company to capture future growth opportunities in Australia and New Zealand will be significantly enhanced.”