As speculation builds about a potential investment announcement from Ihug, the company is still preparing for a public float - suggesting that any investment in the company will take the form of a stake rather than an acquisition.
Ihug director and co-founder Tim Wood said in a newsgroup posting last week that a trust had been set up to handle the company's long-promised employee share scheme and percentages would be "sorted when we go public".
Ihug managing director Nick Wood declined to comment yesterday on a potential investment partner, but did acknowledge that discussions were at a sensitive stage.
Any announcement would end a period of casting about for capital which began in late 1998 when the company announced it was seeking investors in order to pursue plans for expansion. A proposal for Sky Television to take a 30% stake was announced last year but collapsed, with the two companies declaring that their strategies differed too greatly. A culture clash and the terms of the original deal also played a part.
Since then a number of international companies have come calling. The Softbank-linked Asia Online had discussions with Ihug before settling on the 100% purchase of the Internet Company of New Zealand (Iconz). Singapore-based Pacific Internet, which has been aggressively expanding throughout the Asia-Pacific region, had talks with Ihug late last year. While Asia Online is almost certainly not the mystery investor, Pacific Internet may still be in the frame.
Other potential investors might include the European company Chello (see related story), the US-based companies PSINet and MCI WorldCom. Subject to Australian regulatory approval, MCI WorldCom wants to sell OzEmail to Telstra and may be looking for replacement local assets.