TeamTalk has announced it plans to acquire Timaru-based rural telecommunications provider BayCity Communications for up to $42 million.
It would pay $31m up front in cash and shares and up to a further $11m depending on BayCity's subsequent performance over two years.
The deal is subject to approval by TeamTalk shareholders who will be asked to vote on the acquisition next month.
The acquisition is a large one for TeamTalk, which is valued on the NZX at $61.3m. Its shares were trading down 1 cent at $2.61 shortly after the announcement.
BayCity posted revenues of $25.4m in the year to June when it had earnings before interest, tax, depreciation and amortisation of $5.8m.
TeamTalk chief executive David Ware says if the sale goes ahead BayCity will continue to operate from Timaru. "