TeamTalk Limited (NZX: TTK) will sell its remaining 30 percent stake in BayCity Communications — which trades as Farmside — to Vodafone for $3.0 million.
In March 2017 TeamTalk sold 70 percent of Farmside to Vodafone for $10 million in cash, with the option to sell the remaining 30 percent at any time. That move dashed Spark’s hopes of acquiring the business, despite the fact that it had offered $22.7m for 100 percent of the business.
In the run up the shareholder vote on the deal with Vodafone TeamTalk said there were considerable synergies with Vodafone. TeamTalk was one of Vodafone’s largest wholesalers of RBI through Farmside and TeamTalk also provided last mile connectivity to Vodafone enabling it to serve a major corporate rural customer.
TeamTalk’s CEO Andrew Miller said sale of the remaining 30 percent would enable TeamTalk to focus on its key priorities: rolling out its National digital tier III network and undergrounding its fibre network in Wellington’s CBD and that TeamTalk and Vodafone would maintain their relationship. “Vodafone and TeamTalk would continue to work together on strategic opportunities where appropriate,” he said.
Also, TeamTalk said it would work closely with Vodafone to ensure that services provided by TeamTalk under the management agreement were successfully transitioned.
TeamTalk said Vodafone had no plans to make major changes at the present time. “Staff and operations will continue to be based in Timaru, and all the services Farmside currently offers to rural customers will continue,” TeamTalk said.
Vodafone CEO Russell Stanners said the move would reinforce Vodafone’s long-standing commitment to rural communities and enable it to increase its presence in the rural broadband market.”
The parties have agreed that the ownership change will become effective from midnight 31 May 2018.